TaxPrep1
Level 2
09-16-2022
11:49 AM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
If they used to live in the property, there is no need to file 1065 since it’s not an investment, if one of the partners used it as an investment, then he should have filed it on his 1040 Sch E with 50% ownership and when they sell it he will file it as selling a business property and no exclusion applies, and the brother who is living there can file selling as main home and calculate his gain only.
I 1065 was already filed last year as an investment for both, then I would file it again to calculate the investment profit and loss, issue final K-1s, then do the selling on each 1040 as I mentioned above.