When two or more people own a for-profit business, they could form a general partnership. In this case, all partners are responsible for the liabilities and debts of the business. And when tax time rolls around, each partner must report the income from the business as part of his or her personal income.
Some general partnerships, however, are required to register with the Indiana Department of Revenue (DOR). You will need to register your partnership if:
- You will be selling products or tangible items (sales tax)
- You have employees (withholding tax)
- You sell food and beverages (sales tax and food-and-beverage tax)
- You rent accommodations for less than 30 days (innkeeper's tax)
- You rent motor vehicles (motor vehicle rental tax)
- You distribute gasoline or special fuel (prepaid fuel tax)
- You sell tires (tire fee)
- You sell fireworks (safety fee)
To register a partnership with DOR, visit INBiz.
Alison and Jaime run a winery in Fort Wayne. The winery has a small café that allows customers to pair wines with appetizer-style foods. The winery employs 10 people to assist with the café and processing the grapes. Alison and Jaime will need to register their business for food-and-beverage tax, withholding tax and sales tax. Selling bottles of wine and food requires the company to register for sales tax; being in Allen County requires the company to collect a one percent food-and-beverage tax; and having employees requires the company to withhold taxes for employees' wages. The business will register with the department to set up the proper tax accounts. And because they'll be selling alcohol, they will need to get a license from the Alcohol and Tobacco Commission.
This example shows some of the many possibilities for a partnership. It is not meant to provide advice for organizing your business.
For additional help registering your partnership, you may e-mail DOR or call us at (317) 233-4015.
- Indiana Small Business Development Center
- Indiana Secretary of State
- Information on Partnerships from the Internal Revenue Service
- INTax - File and Pay Various Business Tax Types and Much More
- IRS Small Business and Self-Employed Tax Center
- Indiana Current Year Tax Forms
- Frequently Asked Questions