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See what's trending for the November 15th deadline (Form 990) and resources for the upcoming tax season. View Lacerte Hot Topics.
See what's trending for the November 15th deadline (Form 990) and resources for the upcoming tax season. View Lacerte Hot Topics.
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- Re: Partnership K-1s
Partnership K-1s
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JCOhio
Level 1
01-29-2023
06:51 AM
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I have a partnership that rents real estate to a farmer. Rental income and expenses are reported on form 8825 and appear on line 2 of the K-1s. I believe this should be classified as passive income; however., the attachment to the K-1 says it is non passive. I think this is an error, but I have not found a way to correct it.
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Strongsilence-C
Level 10
01-29-2023
12:10 PM
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You want to correct the K-1 prepared by some other firm? What do you want to correct?
If you are sure of passive treatment, then you treat it that way on the 1040 and there is nothing else to do. Is there?
pamdory
Level 8
01-30-2023
09:33 AM
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If you're preparing the partnership return, there is a check box in the General Information section of the 8825 input screen to toggle between passive/non-passive.
However I agree with @Strongsilence-CPA that the determination is really at the partner level. If someone else prepared the 1065 & 8825 they may have a partner for whom the rental is non-passive because they are also the farmer and it could be self-rental.
Or it could be wrong, but if you didn't prepare it then there is nothing you really need to do as long as the partner you're working with is treating it correctly on their 1040.
