partnership

From Florida. I am a partner in a home-cleaning business with a lady friend of mine. My only expenses were obtaining the county business license and posting a bond. While I do accompany my friend and engage in cleaning activity, ALL of the proceeds go directly to her. I do this as a favor to her to help her with college expenses. I have never received any compensation from this arrangement, nor will I in the future. In the past, I have filed a 1040A...I am retired and have only retirement income, non-home owner. My question: Do I have to file a partnership tax showing the income and expenses for the "partnership" business. My partner will be doing so, but it wouldn't seem that I would have to since my work is entirely voluntary w/no compensation. Should I consult a CPA or tax attorney locally?

Mike

If you answer the following questions, I think I can answer your question.

1. Do you have a written partnership agreement?
2. Is your only interest to help your friend?
3. Has anything been filed with the IRS yet?
4. Would you mind giving up your partnership interest and letting her own the business as a sole proprietor?

1. There is no written partnership agreement, per se, but on the application for a county business license we indicated a general partnership with my friend having a 51% interest and I having 49%.

2. My only interest is helping my friend. (Aw shucks, she's the love of my life!)

3. Haven't filed anything with IRS yet. We both plan to submit a request for extension to file on our individual income tax forms...not sure if you can do that on the partnership tax form though.

4. I wouldn't mind giving up my "partnership" interest and her being a sole proprietor...or changing the general partnership to a limited partnership if that would be preferable...and we probably will do that now. Question is, what do we have to do with respect to our 2000 taxes.

Thanks for any help.