As in the case of sole proprietorships, the tax statistics on partnerships (including limited liability companies that file tax returns as partnerships) reflect an improving economy.
For 2012 (the most recent year for statistics), there were 3,388,561 million partnerships (3.1% more than in 2011), representing more than 25.3 million partners (up from 23.3 the year before).
Here is some more interesting tax-related information about these filers:
- Limited liability companies (LLCs) in the U.S. accounted for the majority (65.3%) of all partnership returns. This is the 11th consecutive year that LLCs dominated the number of partnership returns filed. They reported the most profits (33.4% of all returns) and the largest share of partners (42.5%).
- Limited partnerships represented only 12% of all partnerships, but were extremely profitable.
- Total receipts (revenue) for filers increased by 9.4% from the previous year to $6.6 trillion. Profitability was also up, increasing by 33.9%.
Which industries use partnerships/LLCs?
From tax statistics, real estate and rental and leasing were by far the most significant sector, accounting for 49.1% of all returns filed. Other significant sectors were in finance and insurance; health care (laboratories, outpatient centers, social assistance); arts, entertainment, and recreation; accommodation and food services; repair and maintenance; and personal/laundry services.
Which industries are most profitable?
While real estate is the most numerous type of partnership, the finance and insurance sector had the largest share of total net income (43.1%), as well as the greatest amount of total assets (55.2%).
Final thoughts
IRS statistics support what we all know: that the improving economy helps to make businesses more profitable and creates a climate that’s conducive to new businesses. Hopefully, this trend continues.
