An In Depth Look at the IRS Form 8865 and the Foreign Partnership Reporting Provisions of the Internal Revenue Code
By Anthony Diosdi This article discusses most of the Form 8865 questions and schedules. This article is designed to supplement the instructions promulgated by the Internal Revenue Service (“IRS”) for Form 8865. Foreign partnerships controlled by U.S. persons have informational reporting requirements that are similar to the information reporting rules that have been applied to controlled foreign corporations or CFCs. Under Internal Revenue Code Section 6038(a), a U.S. partner that controls a foreign partnership must annually file a Form 8865 with the IRS. A U.S. partner is considered to be in control of a foreign partnership if the U.S. partner holds, directly or indirectly, a greater than 50 percent interest in the capital, profits, or, to the extent provided in the regulations, deductions or losses of the partnership. See IRC…