Partnership state income tax accounting

Acreage · ‎February 19, 2023

Hi all,

I have an LLC (partnership) - which is, of course, a pass through entity for federal income tax purposes. I do business in Colorado which taxes partnerships. How do I account for the Colorado state income taxes? Do I enter the Colorado state income tax as an expense to the partnership in QB? Or do I take an Owner's Draw from the partnership and pay the Colorado State Income taxes out of my personal account? (like I do for federal Income taxes)?

Thanks

JoesemM · ‎February 19, 2023

Hi there, @Acreage.

I see that you've posted the same question twice, and the other one was already answered by my colleague. Just in case you haven't been notified of the new response, here's the link: https://quickbooks.intuit.com/learn-support/en-us/taxes/re-can-i-pay-taxes-for-single-member-llc-fro....

If you have questions along the way, leave a comment below. I’m more than happy to lend a hand.

Acreage · ‎February 19, 2023

Yes, thanks not sure if that thread would be reactivated since it was marked solved. My apologies.

I am still not clear on whether I can expense any State taxes that the partnership pays.

Additional details.

- Partnership was formed in TX (no state income tax)

- Partnership did business in CO

- Partnership filed CO partnership return

- Do I pay the taxes from the partnership and expense it? Or do I take an owners draw and pay the taxes from my personal account.

Thx.

Acreage · ‎February 19, 2023

I think I found my solution. It looks as though partnerships can deduct state income taxes paid for federal income taxes purposes.

Thank you.

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