A partnership doing business in Georgia, earning Georgia-source income, or having even one Georgia-resident partner must file a Georgia partnership tax return on Form 700 by the 15th day of the third month after the close of its tax year. The return is informational at the entity level, since income flows through to the partners, but Georgia still uses it to track apportionment, adjustments, nonresident withholding, composite payments, and any pass-through entity tax election. Skipping it because the partnership itself owes no tax is one of the more expensive mistakes a partnership can make.
Who Has to File
Georgia requires Form 700 if the partnership is required to file federal Form 1065 and meets any one of three conditions: it owns property or does business in Georgia, it earns income from Georgia sources, or it has any partner who lives in Georgia.1Department of Revenue. Taxes for Partnerships The resident-partner trigger catches partnerships that would otherwise assume they have no state connection. One Georgia partner is enough.
The obligation stands even when the partnership has zero entity-level tax. Form 700 tells the Department of Revenue how much income is attributable to Georgia and how it splits among the partners. Failing to file can delay the partners’ individual returns and expose the partnership to penalties on any withholding or composite tax that should have been remitted.
Starting From Form 1065
Preparation begins with federal taxable income from the partnership’s Form 1065.2Internal Revenue Service. About Form 1065, U.S. Return of Partnership Income Georgia then requires additions and subtractions to convert that figure into Georgia net taxable income.
Common additions include intangible expenses and related interest paid to a related entity, captive REIT expenses paid to a related member, and payments over $600 in a tax year to workers who are not authorized employees.3Georgia Department of Revenue. 2025 IT-711 Partnership Income Tax Booklet These must appear on the adjustments schedule before any exception is claimed.
Common subtractions include income from U.S. government obligations that Georgia exempts, federally taxable interest from certain Georgia municipal bonds designated as Build America Bonds, and wages disallowed federally because a federal jobs tax credit was claimed.3Georgia Department of Revenue. 2025 IT-711 Partnership Income Tax Booklet For tax years beginning on or after January 1, 2025, partnerships can also subtract federal and state disaster relief grant payments received for agricultural losses from Hurricane Helene.
Every adjustment feeds through to the partners, so a mistake here misstates every partner’s Georgia income. Keep documentation for each item. The Department of Revenue asks for supporting detail during audits.
Apportioning Income for Multi-State Partnerships
If the partnership operates only in Georgia, all adjusted income is reported to the state. If it operates in more than one state, it apportions income using a single-factor formula based on gross receipts: Georgia gross receipts divided by total gross receipts everywhere.4Justia. Georgia Code 48-7-31 – Taxation of Corporations; Computation, Allocation, and Apportionment of Income Georgia moved to this single-factor approach for tax years beginning on or after January 1, 2008, replacing an older three-factor formula.5Georgia Secretary of State. Georgia Administrative Code 560-7-7 – Taxes
Georgia uses market-based sourcing for the numerator. Gross receipts count as Georgia receipts if they come from customers in Georgia or are otherwise attributable to the Georgia marketplace.5Georgia Secretary of State. Georgia Administrative Code 560-7-7 – Taxes For service businesses and sales of intangibles, the customer’s location controls, not where the work happens.
The apportionment percentage applies only to business income. Non-business income (certain rents, royalties, and investment gains) is allocated to specific states under separate rules.
Nonresident Partners: Withhold, File Composite, or Elect PTE
A partnership must withhold Georgia income tax at 4% on each nonresident partner’s share of Georgia-source taxable income.6Justia. Georgia Code 48-7-129 – Withholding Tax on Distributions to Nonresident Members of Partnerships, Subchapter S Corporations, and Limited Liability Companies The partnership remits the tax and the partner claims a credit on their individual return.
Withholding is not required for a nonresident partner if any of these apply:
- The partner’s aggregate Georgia-source taxable income for the year is less than $1,000.
- The partnership files a composite return covering that partner.
- The partnership has elected the pass-through entity tax.
- The entity is a publicly traded partnership under federal law.
- The commissioner has approved a written petition based on undue hardship.
These exemptions come from the same statute.6Justia. Georgia Code 48-7-129 – Withholding Tax on Distributions to Nonresident Members of Partnerships, Subchapter S Corporations, and Limited Liability Companies The $1,000 figure is the partner’s total for the year, not a per-distribution threshold.
A composite return is the alternative to individual withholding. The partnership pays the entire Georgia tax liability for qualifying nonresident partners in one filing, and those partners do not have to file separate Georgia individual returns.7Department of Revenue. IT-CR Georgia Nonresident Composite Tax Return Eligibility is generally limited to nonresident individual partners, and partners with other Georgia-source income outside the partnership typically cannot participate. The election is annual and requires each participating partner to agree.
The Pass-Through Entity Tax Election
Since 2022, a Georgia partnership can elect annually to pay Georgia income tax at the entity level. The election, authorized by HB 149, is made by checking the applicable box on Form 700 and completing the required schedules.8Department of Revenue. HB 149 Pass-Through Entity Tax FAQ It must be made by the original or extended due date of the return, and it becomes irrevocable after that.
The appeal is federal. Because the partnership pays the state tax, the payment is treated as a business expense that reduces income flowing through to partners at the federal level, working around the federal SALT deduction cap. Partners take a Georgia credit for their share of the entity-level tax.
Two mechanical points. An electing partnership must make estimated tax payments on the same schedule as a C corporation.8Department of Revenue. HB 149 Pass-Through Entity Tax FAQ And the election binds all owners, so a partnership that elects PTE should not also file a composite return for its nonresidents. Georgia’s individual income tax rate is a flat 5.19%.9Department of Revenue. Important Tax Updates
Deadlines, Extensions, and Payment
Form 700 is due on the 15th day of the third month after the close of the partnership’s tax year. For a calendar-year partnership, that is March 15, matching the federal Form 1065 deadline.
Two paths give a six-month extension:
- A federal extension obtained on Form 7004 automatically extends the Georgia deadline. No separate Georgia form is needed; attach a copy of the federal extension or the IRS confirmation to the Georgia return when filed.10Department of Revenue. Requesting an Extension
- If no federal extension is being requested, file Georgia Form IT-303 before the original due date.11Department of Revenue. IT-303 Application for Extension of Time for Filing
An extension gives more time to file, not more time to pay. Any tax owed, whether from nonresident withholding, a composite return, or the PTE election, must still be paid by the original March 15 date. Estimate the liability and send payment with the extension. Late payment triggers interest and penalties even when the return itself is timely under extension.10Department of Revenue. Requesting an Extension
When Electronic Filing Is Required
The Department of Revenue accepts Form 700 through the Georgia Tax Center or approved third-party software. Electronic filing is mandatory for any partnership return that generates, allocates, or claims series 100 tax credits. A partnership that files on paper when electronic filing is required risks having the return treated as unfiled, which triggers penalty and interest.12Department of Revenue. Electronic Mandate Requirements for Filing Income Tax Returns Electronic filing also generates a confirmation of acceptance, useful evidence that the filing obligation was met.
Penalties for Missing the Deadline
Two penalties run concurrently when a partnership files or pays late:
- Late filing: 5% of unpaid tax per month or partial month, capped at 25%.13Department of Revenue. Penalty and Interest Rates
- Late payment: 0.5% of unpaid tax per month, also capped at 25%.13Department of Revenue. Penalty and Interest Rates
Combined, the two cannot exceed 25% of the tax owed on the original return date. Interest runs on top of the penalties. A partnership with no entity-level tax can still be penalized on unremitted nonresident withholding or composite tax, and its partners’ individual returns may be flagged for missing partnership information.
The late filing penalty accrues at ten times the rate of the late payment penalty. If you cannot do both on time, file the return and pay what you can. An extension shields against the filing penalty but does nothing for the payment penalty, which is why estimating and paying by March 15 still matters when the return itself will be late.