My client is a limited partner in a partnership. They have guarantee payments as well as unreimbursed mileage. When I enter the mileage and other deductions as UPE, it does not reduce self employment taxes. I thought this was allowed against SE tax. Can someone provide insight on the rules here. They do have a positive capital basis.
Also, they have a sec 179 deduction on form K-1. The spouse has negative farm income. Is sec 179 limited by the joint income or should I be changing something on 4562 to allow the deduction. The sec 179 deduction is less than their basis in the partnership and is less than the guarantee payment.
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Be aware that the partnership agreement needs to state that such expenses will not be reimbursed.
searched and searched to find where to deduct UPE from the SE tax calculation thank you !!
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