K-1 reporting in Partnership Program

[mikestonecpa]

I have a partnership that owns interests in "investment" partnerships, which have very complex K-1s.  The Individual program is much more robust in its K-1 input than the Partnership program is.  For example, the Partnership program does not even calculate/track basis in the partnership interest.  Are there any plans to improve the handling of K-1 entities within the Partnership program in the near future, hopefully to bring it up to speed with how that information is received and processed in the Individual program?

[Strongsilence-CPA]

The partnership module produces this worksheet.

[sjrcpa]

They have been lacking in this area (for 1041s and 1120s, too) for the last 25 years. So don't expect anything in the near future.

[sjrcpa]

That's the first enhancement in this area in years.

[mikestonecpa]

That is a basis schedule for partners of the filing partnership (P1).

I was talking about basis in a partnership (P2) that the filing parternship (P1) is a partner in.

Eg, P2 income flows into P1 which flows out to partners of P1.  If P1 was an individual, the Individual program tracks the basis of P2.  The Partnership program does not, meaning we have to keep separate schedules to track it outside of the program.  That's what we Dinosaurs did back when dirt was new.  I was kinda hoping I wouldn't have to go back to those bad old days...

[Strongsilence-CPA]

To mike and sjr, 

Since you might be lurking...

do you know if at-risk and basis for each passive investment are required for a RE professional who has elected to group passive activities?  

The taxpayer and spouse qualify to make the election.

I took over a client and have more facts but I'll just say that the prior CPA did not prepare basis schedule or at-risk forms. The client does not want to ask the prior CPA.  I don't want to prepare these forms if not required.

Once two activities have been grouped into one larger activity, taxpayers only need to show material participation in the activity as a whole. Whereas, if the two activities are treated as separate activities, taxpayers must show material participation in each one.
(2)	If activities are grouped together for tax purposes, taxpayers will be in a better position to use up any suspended passive losses because taxpayers have disposed of their entire interest in that activity.
(3)	Grouping can also be important in determining whether a taxpayer satisfies the 10 percent ownership requirement for actively participating in a rental real estate activity.

[Strongsilence-CPA]

"Do you know if at-risk and basis for each passive investment are required for a RE professional who has elected to group passive activities? "

After more reading on this topic, I think the answer is that basis and at-risk calculation ARE required.  Because activities can be grouped and regrouping are allowed, there is a possibility that an activity will be separate. Once separated losses will then be subject to basis and at-risk limits. Therefore, with that possibility, basis and at-risk calculation would be a good idea.

[sjrcpa]

I agree.

Lurker.