Compilation of Rules and Regulations of the State of Georgia › Department 560 - RULES OF DEPARTMENT OF REVENUE › Chapter 560-7 - INCOME TAX DIVISION › Subject 560-7-3 - SUBSTANTIVE REGULATIONS › Rule 560-7-3-.08 - Partnerships

Current through Rules and Regulations filed through June 27, 2024
(1) Except as
				provided in Paragraph (8), partnerships, as such, are not subject to income
				taxation under Georgia Law, but are required to make returns of income. The
				members of a partnership are, however, taxable upon their distributive shares
				of net income of such partnership, whether distributed or not, and are required
				to include such distributive share in their returns. The net income of the
				partnership shall be computed in the same manner and on the same basis as the
				net income of an individual, except that the declaration of contributions or
				gifts is not permitted, as these are allowable deductions subject to the
				limitations provided by the Internal Revenue Code of 1986 to the respective
				partners in their returns.
(2) Each
				partner is required to include in the person's return, for the person's taxable
				year within which or with which the taxable year of the partnership ends, the
				person's distributive share of the net income of the partnership, whether or
				not distributed.
(3) Where the
				result of partnership operation is a net loss, the loss will be divisible by
				the partners in the same proportion as net income would have been divisible
				(or, if the partnership agreement provides for the division of a loss in a
				manner different from the division of a gain, in the manner so provided), and
				may be taken by the partners in their return of income.
(4) Payments made to a partner for services
				rendered or for interest on capital contributions are not deductible in
				computing the net income of the partnership, such payments being held to
				represent a division of partner profits.
(5) Every partnership, including foreign
				partnerships, the members of which are subject to taxation under Georgia law,
				shall make a return for each taxable year, stating specifically the items of
				its gross income and the deductions allowed by this law, and shall include in
				the return the names and addresses of the members who would be entitled to
				share in the net income if distributed and the amount of the distributive share
				of each member. The return must be signed as provided by Regulation
				 560-3-2-.27.
(6) Where one or more of the members is a
				resident of Georgia but a member of a partnership doing business without the
				State of Georgia, such resident member or members shall include in the person's
				return the person's distributive share (whether distributed or not) of the net
				income of the partnership for the taxable year.
(7) Capital gains and losses shall be
				excluded in determining the partnership net income. Such sales and exchanges
				should be shown in detail on the Partnership return but the results should be
				transferred to the partners' returns in their proportionate share.
(8)
Electing Pass-Through
				Entity.
See Regulation
				 560-7-3-.03  for the rules regarding
				a partnership that makes the election to pay tax at the entity level.
(9)
Effective Date.
The principles set forth in this regulation will apply to taxable years
				beginning on or after January 1, 2022. Taxable years beginning before January
				1, 2022 will be governed by the regulations of Chapter 560-7 as they exist
				before January 1, 2022 in the same manner as if the amendments thereto set
				forth in this regulation had not been promulgated.
O.C.G.A. §§
											48-2-12,  48-7-23,  48-7-24,  48-7-53.