Partnership taxation refers to the tax treatment of income earned by a partnership, which is a business structure where two or more individuals share ownership. Unlike corporations, partnerships do not pay income tax at the entity level. Instead, profits and losses are passed through to the individual partners, who report them on their personal tax returns. Each partner receives a Schedule K-1, which details their share of the partnership's income, deductions, and credits. This pass-through taxation allows partners to avoid double taxation, which is common in corporate structures, making it a popular choice for many small businesses and professional practices.