Composite Partnership

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Composite Partnership

Who Must File

Partnerships engaging in activities in Louisiana that have nonresident partners are required to file a composite partnership return unless:

a. All nonresident partners are corporations, partnerships or tax exempt trusts; or
b. All nonresident individual partners have a valid agreement on file with the Department of Revenue.

All nonresident partners who were partners at any time during the taxable year and who do not have a valid agreement on file with LDR must be included in the Louisiana Composite Partnership Return (See LAC 61:I.1401). The agreement, in the form of an affidavit, must include a statement that the taxpayer agrees to timely file a Louisiana Nonresident Individual Income Tax return and make payment of Louisiana individual income tax.

Who Cannot Be Included in a Composite Return Filing

  • Partners who are corporations are required to file Form CIFT-620 to report any partnership income.
  • Partners who are Louisiana resident estates and trusts are required to file Form IT-541 to report partnership income.
  • Partners who are themselves partnerships are required to file all applicable Louisiana tax returns. Refer to LAC 61:I.1401.
  • Partners who are Louisiana residents are required to file Form IT-540 to report partnership income. Refer to LAC 61.I.1401.

Filing Requirements

Louisiana Revised Statute 47:201.1(F)(4) requires the electronic filing of all composite partnership returns (Approved Vendors). If tax credits are claimed on the composite return:

  • ALL nonresident partners must be included on the return and on Schedule of Included Partner’s Share of Income and Tax.
  • ALL partners, including residents, corporations and other partnerships must be included on Schedule of Not Included Partner’s Share of Income and Tax.

If the partnership is not required to file a composite return because all its partners have filed agreements to file on their own behalf, the partnership must make an initial filing in which it files all agreements with the LDR by the composite return due date.

Due Date of Returns and Payments

Returns and payments are due on or before May 15 of the following year. For fiscal year taxpayers, returns and payments are due on the 15th day of the fifth month after the close of the fiscal year. If the due date falls on a weekend or legal holiday, the return is due on the next business day.

Determination of Tax

A tax rate of 6% (.06) is assessed on the total distributive shares for nonresident partners included on the Louisiana Composite Return.

Requesting an Extension of Time for Filing a Return

Revised Statute 47:1514 allows a six-month extension of time to file the composite partnership return to be granted on request. The extension request must be made electronically before the state tax filing due date, which is May 15 for calendar year filers or the 15th day of the fifth month after the close of a fiscal year.

In the past, taxpayers were allowed to request a filing extension by filing a paper state extension or paper federal extension (Form 7004). Beginning with the 2013 income tax year, taxpayers will be required to electronically request a state composite partnership filing extension on or before the May 15 due date. Paper state or federal extension request will not be accepted.

This new requirement is the result of changing technologies and processing procedures within the department.

The three options for requesting an extension are as follows:

  1. Filing an extension request electronically via the Louisiana Department of Revenue's Online Extension Filing application;
  2. Filing an extension request electronically via LDR’s IVR phone system by calling 225-922-3270 or 888-829-3071. For an extension request, select option #3, then select option #3. Taxpayers will need the composite partnership LA account number to request the extension; or
  3. Submitting the extension electronically through tax preparation software that supports the electronic filing of the Louisiana Application for Extension to File Composite Partnership Return. See approved vendors.

Tax preparers can also utilize the bulk extension filing application to submit multiple extension requests. This application can be used by any firm who has an Electronic Filing Identification Number (EFIN) registered with LDR or any taxpayer who has a current Louisiana Account Number listed with LDR.

An extension does not allow an extension of time to pay the tax due. Payments received after the return due date will be charged interest and late payment penalty.

Automatic Extensions Granted for 2013 Tax Year

LDR has decided to provide for an automatic extension of six (6) months for the filing of the 2013 Composite Partnership Returns. Calendar year returns will now be due on November 15, 2014. This extension grants additional time only to file a return. It does not grant additional time to pay taxes due. See Revenue Information Bulleting No. 14-008 for more information.

Options for When a Payment Needs to be Made with the Extension Request

Payments cannot be made through the bulk extension filing application on LDR’s website. If you need to make a payment, you must submit an extension request electronically and:

  1. Mail in a check or money order with the electronically filed extension payment voucher, Form R-6467V;
  2. Print an extension payment voucher through LDR’s the Online Payment Voucher application;
  3. Make a payment using either a bank account or a credit card through LDR’s File Online application;
  4. Requesting the extension and make the payment electronically through tax preparation software that supports this option; or
  5. By credit card at Officialpayments.com.

Please do not use Form R-6922V, Composite Partnership Electronic Filing Payment Voucher, to submit an extension payment. Form R-6922V is to be used only by tax filers that have filed their tax returns through electronic filing and need to make a payment.

An extension does not allow an extension of time to pay the tax due. Payments received after the return due date will be charged interest and late payment penalty.

Filing an Amended Return

If you file your composite partnership and later become aware of any changes you must make to income, deductions, or credits, your must file an amended (corrected) Louisiana return. Amended returns must be filed electronically. Make sure you check the box to designate the return as an amended return.

In order to amend the amounts reported for the computation of tax paid on behalf of nonresident partners, the taxpayer must file an amended return, along with a detailed explanation of the changes.

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