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Schedule B-1 (Form 1065) (Rev. 8-2019) Page 2
General Instructions Example 1. Corporation A owns, directly, an interest of 50%
in the profit, loss, or capital of Partnership B. Corporation A
Section references are to the Internal Revenue Code unless also owns, directly, an interest of 15% in the profit, loss, or
otherwise noted. capital of Partnership C. Partnership B owns, directly, an
interest of 70% in the profit, loss, or capital of Partnership C.
Future Developments Therefore, Corporation A owns, directly or indirectly, an
For the latest information about developments related to interest of 50% in the profit, loss, or capital of Partnership C
Schedule B-1 (Form 1065) and its instructions, such as (15% directly and 35% indirectly through Partnership B). On
legislation enacted after the form and instructions were Partnership C’s Form 1065, it must answer “Yes” to question
published, go to www.irs.gov/Form1065. 2a (question 3a for 2009 through 2017) of Schedule B.
Partnership C must also complete Part I of Schedule B-1. In
Purpose of Form Part I, Partnership C must identify Corporation A, which includes
entering “50%” in column (v) (its maximum percentage owned).
Use Schedule B-1 (Form 1065) to provide the information It also must identify Partnership B, and enter “70%” in column
applicable to certain entities, individuals, and estates that own, (v).
directly or indirectly, an interest of 50% or more in the profit,
loss, or capital of the partnership. Part II
Who Must File Complete Part II if the partnership answered “Yes” to Form
1065, Schedule B, question 2b (question 3b for 2009 through
Schedule B-1 (Form 1065) must be filed by all partnerships that 2017). List each individual or estate owning, directly or
answer “Yes” to question 2a or question 2b (question 3a or indirectly, an interest of 50% or more in the profit, loss, or
question 3b for 2009 through 2017) on Form 1065, Schedule B. capital of the partnership at the end of the tax year. Enter the
Attach Schedule B-1 to Form 1065. name, social security or employer identification number, country
of citizenship (for an estate, the citizenship of the decedent),
Specific Instructions and the maximum percentage interests owned, directly or
indirectly, in the profit, loss, or capital of the partnership.
Part I Example 2. A owns, directly, 50% of the profit, loss, or capital
Complete Part I if the partnership answered “Yes” to Form of Partnership X. B, the daughter of A, does not own, directly,
1065, Schedule B, question 2a (question 3a for 2009 through any interest in X and does not own, indirectly, any interest in X
2017). List each corporation, partnership, trust, tax-exempt through any entity (corporation, partnership, trust, or estate).
organization, or foreign government owning, directly or Because family attribution rules apply only when an individual
indirectly, an interest of 50% or more in the profit, loss, or (in this example, B) owns a direct interest in the partnership or
capital of the partnership at the end of the tax year. Enter the an indirect interest through another entity, A’s interest in
name, EIN, type of entity (corporation, partnership, trust, tax- Partnership X is not attributable to B. On Partnership X’s Form
exempt organization, or foreign government), country of 1065, it must answer “Yes” to question 2b (question 3b for 2009
organization, and the maximum percentage interests owned, through 2017) of Schedule B. Partnership X must also complete
directly or indirectly, in the profit, loss, or capital of the Part II of Schedule B-1. In Part II, Partnership X must identify A,
partnership. For an affiliated group filing a consolidated tax which includes entering “50%” in column (iv). Partnership X will
return, list the parent corporation rather than the subsidiary not identify B in Part II.
members. List the entity owner of a disregarded entity rather
than the disregarded entity. If the owner of a disregarded entity
is an individual rather than an entity, list the individual in Part II.
In the case of a tax-exempt organization, enter “tax-exempt
organization” in column (iii).
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