Final K-1

Forum|Forum|5 years ago
May 16, 2021
2 replies
36 views

Taxpayer has a final K-1 partnership. Did not sell. Just closed and stopped doing business. Partners were brother and sister. They had the business for 3 years. Never made a profit. Each put in $7500 start-up. Only info on the K-1 is Ordinary loss ($402). Receiving error in part 2. Would this be considered a liquidated or abandoned? Just by checking abandoned, it frees up over $9000 in suspended loss carryover. Do this seen right?

ProSeries Basic

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Best answer by jeffmcpa2010

Correct the beginning capital of the first year should be 0.

What they put in should show as Contributions on the Capital portion of the K-1.

There was nothing when they started - then they put it in.

sjrcpa

Level 15

Why were the losses suspended?

The more I know the more I don’t know.

K

karzakAuthor

Level 3

passive loss rules

PATAX

Level 12

Did he already receive a deduction for the 7500 in the $9,000 loss? Just asking not sure... Just my opinion

K

karzakAuthor

Level 3

ok. Now I am a little confused. Taxpayer claims they put out $15,000 initially/$7500 each. Found Initial K-1 and it has beginning capital account as zero.

J

jeffmcpa2010Answer

Level 10

Correct the beginning capital of the first year should be 0.

What they put in should show as Contributions on the Capital portion of the K-1.

There was nothing when they started - then they put it in.

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