Sale of partnership interest - mechanics of entry in ProSeries

[FrankK]

I have a client who sold their interest in a partnership in 2021. Client has not yet received a copy of the Partnership 1065, K-1, or Form 8308, but I need to enter info to determine whether a payment is due with an extension. Below are the relevant numbers as of the date of sale:

Sales price: $365K

Partner's tax basis: $108K

Gain on Sale: $257K

At the time of Sale, the Partner's share of the following items was:
Cash: $104K

A/R: $65K

Depreciation Recapture: $1K

The Partner agreed to sell their share on the installment basis. Principal payments received in 2021 totaled $128K.

Given the above, I thought I entered the information correctly on Forms 4797 and 6252. But the results do not make sense. Do I apply the principal payments first to the "ordinary income items" from the sale before reporting any principal payments on Form 6252?  If so, where are the principal payments reported for the ordinary income items?

Thanks in advance for your feedback.

[Livinglife]

Hi,

Am wondering if you ever received a reply or figured it out. I have a similar situation with the sale of an LLC membership with recapture and installments. Struggling to figure out how to make it work properly in ProSeries. Any assistance is appreciated. 

[FrankK]

No responses, but I figured it out by creating an Excel worksheet to calculate the correct values, then had to poke around in ProSeries to determine how to enter the information on the worksheets to make the numbers come out correctly. Unfortunately, that was two years ago. I'll see if I made enough notes to be of value, and if so, I'll post them.

[Livinglife]

Thank you for the prompt reply! I appreciate your efforts on my behalf. Working on this today. Wish me luck. 

[George4Tacks]

https://accountants.intuit.com/support/en-us/help-article/partnership/disposing-partnership-corporat...

https://accountants.intuit.com/community/proseries-tax-discussions/discussion/sale-of-partnership-in...

Cruise through this search to maybe find more help. https://accountants.intuit.com/support/en-us/help-search/1?document_type=All&filter=ProSeries+Basic&...

[Livinglife]

George,

Thank you. The membership interest was sold not individual assets. The information provided was mostly outside of the k-1. Sales price, expenses, tax basis and gain. The gain was broken down between 1245 recapture and 1231 long term capital gain. There is also an installment note portion so need to run through form 6252. IDK how to get the recapture on the 4797 and for it to show on the 6252. Wondering if I need two entries.  One where I enter the recapture as the sales price on the 4797 with no depreciation and then refigure or force the 6252. There is enough gain to cover all of the recapture and more. 

any help is greatly appreciated.

[George4Tacks]

I am not strong on ProSeries entries. https://accountants.intuit.com/support/en-us/help-article/schedule-k-1/common-questions-form-6252-pr...

Maybe @Just-Lisa-Now- can add some insight.