unreimbursed partnershp expenses

[DaveO]

The UPE can be a real headache. I had a partnership, a father and two sons. I explained how the UPE could allow them to deduct misc expenses such as subscriptions and cont ed where the other members didn't participate. Next year they all came in and had bought new trucks and wanted to run them through as UPE.

[David1980]

If it is a husband and wife owned business how about a "qualified joint venture". They file 2 Sch C and prorate the income and expenses based on a reasonable formula. I have several clients who run some "out of the garage" business to earn extra money. One couple made $40k selling pickles and jams, syrups etc. from their basement kitchen!

It's the "LLC" part that causes a problem with QJV and thus requires the partnership return. "Only businesses that are owned and operated by spouses as co-owners (and not in the name of a state law entity) qualify for the election." http://www.irs.gov/Businesses/Small-...ted-Businesses

[ATSMAN]

If it is a husband and wife owned business how about a "qualified joint venture". They file 2 Sch C and prorate the income and expenses based on a reasonable formula. I have several clients who run some "out of the garage" business to earn extra money. One couple made $40k selling pickles and jams, syrups etc. from their basement kitchen!

[oceanlovin'ea]

one year only

This is a one time partnership return. Client formed an LLC and put husband and wife on it. THEN asked me about the partnership. I told them to take wife off or they would have to file a partnership return. But she got busy and forgot to do it. So this year is a partnership return. She has taken her name off and for 2015 it will be taxed as sole prop.
That is what they intended all the time. When he applied for the EIN, it sales sole prop.

Somehow people think that they have to have wife on LLC just in case something happens to them. It works ok if they are taxed as S corp. but not if they mean to be taxed as sole prop.

This is the vehicle expenses for the year.

[ATSMAN]

if the partnership has substantial unreimbursed expenses, they may have an issue down the road. I would strongly suggest they institute an accountable plan and/or pay the legit business expenses that are "ordinary and necessary" out of the partnership accounts.

[BHoffman]

I haven't done a partnership return in quite a while. I am not doing the personal return either. Is there a place on the partnership return that I enter the amount of unreimbursed partnership expenses that the partners are allowed to take. Or is it just entered on the personal return?

Thanks

Linda, EA

Hi Linda - Entered on the partner's 1040 only.

[oceanlovin'ea]

I haven't done a partnership return in quite a while. I am not doing the personal return either. Is there a place on the partnership return that I enter the amount of unreimbursed partnership expenses that the partners are allowed to take. Or is it just entered on the personal return?

Thanks

Linda, EA