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In the ProConnect Tax Online, in the Partnership Return, each partner's capital account balance should be the same amount as the end-year capital account balance of the previous year's ending balance, but, while the total capital account of the beginning balance matches to the last year's capital balance, each partner's capital balance as of the beginning balance shown in each partner's K-1 was wrongly calculated by the Program, showing a completely different amount. The per-partner's capital percentages are correct and yet, it looks as if the program automatically allocate that total amount based on the ENDING percentage of the CURRENT year, so that the beginning capital amount of each partner completely differs from the last year's capital balance for each partner.
The accurate amounts are entered in the basis worksheets, but none of these entries are not reflected in the capital account calculation. And there is no place where I could enter the accurate capital balance for both beginning and ending balances for each partner to reflect the accurate Beginning Capital amount for each partner.
The critical problem is that the program automatically calculate each partner's BEGINNING capital amount based on the current year's ENDING percentage.
How to fix this critical problem, when there is place to manually enter each partner's beginning capital amount?
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The program does not compute beginning partner beginning capital account balance. Last year it would have computed an ending balance and possibly it brought forward an incorrect amount. Go into each partner account and enter the correct beginning balance.
Across the top are Profile, Input Return Special Allocations .... Select Special Allocations and you can enter the beginning balance for each partner. That is also where you would make specific allocations of various items of income and expense PER PARTNER, being very careful that they properly total out to the amount computed by the program.
Answers are easy. Questions are hard!
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There is no place where you can enter each partner's beginning capital balance, which was supposed to be needed if the last year's return was rolled over or converted to 2018 return properly.
The "total" of partner's beginning capital is accurate, but not accurate in each partner's beginning capital balance. And all the percentages are supposed to be carried from the last year's return, but the program automatically calculate the beginning capital balance of each partner based on the ENDING percentage of the current year.
Even if the Special Allocations can be used, they are applied to the ENDING capital balance, not the beginning balance.
P/L percentages are 50/50, so it is ok, no problem, but, the capital account of each partner has to be different and has to be coming from the last year's ending balance, which was not done in this program. And there is no place to overwrite each partner's capital account.
I really think that this program is only for individuals, not for pass-through entities, because the program can't do per-partner's capital calculations.
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Think this is what you'd like to do. There is a $1 difference in allocation for non-deductible expenses because you rounded down the allocation but PTO did not. If you're looking for a different set of output, what exactly should the results be?
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Still an AllStar
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Still I would think that this solution is only for the users, who should take time to do this in order to get the accurate amounts. I still think that the program provides the right boxes in the Input Screen, not Special Allocation, and that the program should NOT calculate this way, beginning capital amount per partner based on the Ending Percentage of this year, which makes everything wrong and which does not make sense at all.
Nonetheless, I thank you all for the helps. Thank you very much.
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Still an AllStar
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It sounds like you may need to contact support. Here are two images to help
- Enter a beginning capital amount (I used $11,000) I have two partners that get a 30/70 split.
- Click the Special Allocations (starred in the 1st image) and enter beginning capital for the partners so that it totals $11,000 (from step 1) in any allocation you want. In my case I would have gotten 3,300 for one partner and 7,700 for the other, but I have entered a different total
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Still I would think that this solution is only for the users, who should take time to do this in order to get the accurate amounts. I still think that the program provides the right boxes in the Input Screen, not Special Allocation, and that the program should NOT calculate this way, beginning capital amount per partner based on the Ending Percentage of this year, which makes everything wrong and which does not make sense at all.
Nonetheless, I thank you all for the helps. Thank you very much.
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"The "total" of partner's beginning capital is accurate, but not accurate in each partner's beginning capital balance. And all the percentages are supposed to be carried from the last year's return, but the program automatically calculate the beginning capital balance of each partner based on the ENDING percentage of the current year."
Since the total of partners' beginning capital is correct and only the allocation is incorrect, perhaps you could try the following under Partner Information > Partner Percentages > BEGINNING (XX.XXXXXX)
- OWNERSHIP OF CAPITAL: Enter the correct allocation for each parnter (e.g. Partner A = 20%, Partner B = 10%, Partner C = 70%)
This should get the correct amounts of capital flowing to the respective K-1's for Beginning capital account.
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This is 2-partners partnership LLC.
Last year's Capital: Partner A: 13279, Partner B: 35,066 (Total capital 48,345)
Capital %: A 50 B 50 (at the end of 2017)
Beginning Percentage: 50 50
Partner A does the most of business work. Partner B does administrative work. Partner A withdrew lots of money from account during 2018.
To protect A's basis, A changed the percentage of PL (Profit 50 to 90, loss unchanged, Capital 50 to 90)
CY Profit shares: Partner A (90%) 39,884 Partner B (10%) 4,432
(Non-deductible expense adjustment): Partner A 189, Partner B 22
Ending percentage of 2018: Partner A: 90% Partner B: 10%
Partner A withdrawal: 30,847 Partner B withdrawal: 1,929
In the Basis worksheet, all of these numbers are entered. But the serious problem of ProConnect Tax online program is that it CHANGED the beginning capital amount of each partner, and calculated the beginning capital that shouldn't be changed, by using the ENDING percentage of 90% and 10%.
And there is no place where you could overwrite or manually enter each partner's Beginning Capital Amount (other than percentages, but the beginning percentages are not used, and program uses ENDING percentages only).
What do you think? Am I missing something, or would you know something that fixes this problem?
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Honestly, I don't think it is PTO, but rather your input that has created some problem. The program (although not flawless), does work. It is a difficult program to master.
Answers are easy. Questions are hard!
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And didn't you notice that many others posted similar questions, although the area of the questions are different, but all of the questions' bottom line is the same. The program changes and calculates capital accounts when it shouldn't, and therefore, some of elements in the capital accounts are wrongly changed.