Group Term Life Insurance and IRS Form 1065 Line 19

Does Group Term Life Insurance Appear on Line 19?

Group term life insurance premiums paid by a partnership for its partners are not reported on Form 1065 Line 19. Line 19 captures the partnership's total tax‑payable income, not specific expense categories. Premiums paid for life insurance are treated as a deductible partnership expense and are recorded on the partnership's Schedule K‑1 as a partnership deduction, not as income.

How to Record the Premiums on the Return

The partnership must include the premiums in its total expenses on Form 1065, Schedule A, under "Other Deductions." They are then passed through to partners on Schedule K‑1 as a deduction that partners can claim on their individual returns.

Step‑by‑Step Filing Guide

• Enter the total premium amount in Schedule A, line 8 (Other Deductions).
• Ensure the expense is categorized under "Insurance" or "Other Deductions" per the instructions.
• Allocate the expense to partners on Schedule K‑1, noting the partner's share in column J.

Why Line 19 Is Not Used

Line 19 reports taxable income after subtracting ordinary and necessary deductions. Since insurance premiums are deductible expenses, they reduce taxable income but are not shown as a separate line item. Reporting them elsewhere avoids double‑counting and keeps the return compliant with IRS guidance.

Common Misconceptions

Some partners think the premiums must be reported on Line 19 because they affect partnership income. However, the IRS treats these premiums as ordinary partnership expenses, not income. Misreporting them can lead to an overstated income figure and potential penalties.