Arkansas Administrative Code
Agency 006 - Department of Finance and Administration
Division 05 - Division of Revenues
Regulation 1997-4 - Comprehensive Individual Income Tax Regulations
Rule 26-51-102 - DEFINITIONS
Rule 2.26-51-102(4) - Partnership

Partnership Return -- AR1050

Extension of Time -- AR1055

A "partnership" includes a syndicate, group, pool, joint venture or other unincorporated organization through, or by means of which, any business, financial operation or venture is carried on if it is not, within the meaning of the IRC, a corporation, trust or estate. IRC Sec. 761(a). A partnership exists when two or more persons join in carrying on a trade or business, with each person contributing either money, property, labor or skill. The partnership agreement doesn't have to be written, it can be oral. IRC Sec. 761(c); Reg. 1.761-1(c). A joint undertaking merely to share expenses isn't a partnership. IRC Reg. 1.761-1(a). Partnerships are treated as a conduit or "pass-through entity" and are, therefore, not subject to taxation. The various items of partnership income, gains and losses, etc. flow through to the individual partners and are reported on their individual income tax returns. Moreover, every domestic or foreign partnership doing business within Arkansas or which has received income from sources within Arkansas (regardless of the amount), shall file an Arkansas partnership return.