Partnerships are "pass-through" entities, which means both the expenses and the income that the partnership generates pass through the partnership to the individual partners via the Schedule K-1.

The result is that, if the partnership shows a loss or a profit, that loss or profit is reported on the partner's individual income tax return.

The partnership DOES file an income tax return using Form 1065, but that return is an information return; no income taxes are paid.

Now, if the partnership has employees (and the partners can and in most cases SHOULD be paid employees of the partnership), then the partnership WILL pay employment taxes, plus local/county/state business taxes may also be paid by the partnership.

A partnershp return is NOT for amateurs; get professional help from either a tax accountant, a CPA or an enrolled agent.