Partnership for rental but 100% goes to one partner. Can this be reported without a K-1 and with Sch Es on her tax return?

Forum|Forum|5 years ago
March 24, 2021
9 replies
33 views

The kids set up an LLC partnership for each of the 3 rentals their elderly mother owns (with a separate EIN for each) but she wants to just put them on her tax return as she has done for 30 years. All of the income/loss will be going to the mom 100% (at her request). Can I just put them on her tax return as schedule Es and not worry about filing 1065s for each of the rentals with K-1s? The kids are good kids, I know them all, they were just trying to look out for their mom and also thinking about the future.

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E

ehill

Level 5

If it is a single person LLC, it goes on the 1040 as a disregarded entity. Look at the LLC to see if it is a partnership or not.

J

jeffmcpa2010

Level 10

Are there any owners of the llc's other than Mom?

If yes you must follow the LLC agreement regarding allocation of profits and losses, or if nothing is specified than they must be allocated based on ownership.

If she is the only owner, than they go straight to Schedule E as disregarded entities.

U

utah-arizona-taxladyAuthor

Level 6

The certificate of organization shows 4 members but no %'s. The letters from the IRS for all 3 rentals show to file a 1065. But Mom (age 80 + going on 130) wants to take all the income (none have losses anymore) and just file "like she has always done" for this year. That is the way she did the books she says. The LLCs started late August of 2020. I really don't want to split the info up for the year. She will never be able to do it. I will have to look at all the dates on her hand written lists and split it all up. Do partnerships have to file tax returns like S-corps do? I don't deal much with partnerships.

sjrcpa

Level 15

Partnerships do have to file tax returns - 1065 and state.

Do they perchance have Operating Agreements that say how income/loss will be allocated?

Did the title to the properties really get transferred to the LLCs?

Partnerships with special allocations are not for the feint of heart/inexperienced.

Many states also have annual fees for LLCs.

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

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