Level 3

Joint Venture Reporting

11 replies
97 views

Should the Joint Venture be reported on a Partnership Return with the K-1 going to each venturer?

If not, where on the 1040, which Schedule, should the income be reported? My client received a Form 1099-Misc, with income and loan payments combined in the "Non-employee Compensation" box. Help!

ProSeries Professional

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Susan11_2

Level 2

Joint venture is an election for the federal for a married filing joint 1040. How the couple reports (1040 or 1065) will be determined by if this is a separate property or community property state and if this is a husband/wife sole proprietor or an LLC. They may have to file a 1065. In which case, the K-1's produced will be entered like any other income document.

If they are able to take the joint venture election, they will file either 2 schedule C or E, with all expenses split equally between the two.

For the issue of the 1099 with the incorrect amounts reported, if they can ask the issuer to correct it, that would be best. If not, there are a couple of ways to handle that.

sjrcpa

Level 15

Any 2 people or companies can form a joint venture. It is not unique to a married couple.

Is the 1099-MISC issued to your client or is it in the name of the joint venture?

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

Susan11_2

Level 2

Made out to Client. I asked Client to have 1099 corrected, which had loan payments plus under $600. of labor. Form 1099 should be zero. Thank you for your help.

That is best! Be careful though, his 1099 would not be 0 if his amount is under $600 yet above zero. Whatever is left can be a write in as other income under adjustments to income. Good luck!

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