<prompt> Human: My band is starting up a band bank account, and it looks like we are going to form a general partnership. The way we operate at the time, all band income goes into a band fund and is used for band expenses equipment, recording, etc. None of us take any personal money from this income.When we file taxes, how do we report the bands income? Obviously someone or something will need to report that money as income, but since none of us take a cut, who would that be? We will be listed as partners equally, all filing forms 1065, K-1, 1040, and Schedule SE.Thanks!  <response>: Hey, Im a CPA so I can answer this.you will have to pick up the income shown on the K-1 given to you from the partnership. How the money gets allocated is completely dependent on your operating agreement where everyone agrees on the allocation of income.Your K-1 will give you information of your portion of income loss for the year. If those items net to a loss, you obviously will not pay tax on it. If those items net to a profit, you will pay taxes on it, depending on whether you have some passive activity loss carried forward.There are different types of draws. Distribution means taking money out of the company that you already reported on your returns and paid taxes on. Say your portion of the profit was 50K a year before, then you paid the taxes on it when you filed your return. A year later, lets say you want to take 20K of the money as distribution, then you will not have to pay taxes on the 20K draw since you already paid taxes for it.Guaranteed Payment is a little different. If, say you have the band pay you a regular salary, then the partnership will not be able to deduct that as an expense. Meaning, you will have to pay taxes on that salary, including self employment taxes.Now, to the actual money for the taxes. There are ways that you can set it up where by the time you figure out how much you had to pay for your taxes for federal and states in your individual 1040 for your portion of the band income, the partnership can write you a check as a distribution, and you can use that money to pay the taxes. But the actual payment HAS to come from you, at least for the Federal level. There are states that let the partnership file whats called a composite return, basically filing on behalf of the partners for a certain state. This composite return almost all of the states is not possible, however, if the state is your resident state.Hope that helps.EDIT: I hope you understand that only one 1065 needs to be filed for the band, which will shoot out K-1s for the partners in the band. Tax Matters Partner, or whoever you guys agree that should have the authority to sign the return, will be signing the return. Partnership itself doesnt pay taxes - not in federal level. May have some minimum entity level taxes depending on states. Those partnership level taxes will have to be written from the band check. 