How to prepare K-1 for partner with loss in excess of basis

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  • Greenbriar
    Senior Member
    • Jun 2007
    • 189

    #1

    How to prepare K-1 for partner with loss in excess of basis

    New LLC in late 2018, partner A contributes 5,000, partner B zero. LLC has 800 loss. I give A a k-1 with 400 loss on line 1, what does B get on her K-1? Program is also giving her 400 loss on K-1 but she has no basis and there are no LLC liabilities. I worked the basis worksheet in the program but it still shows a loss on line 1 of K1 for partner B. I really want to suppress it and carry forward to 2019. thanks for any comments.
  • Greenbriar
    Senior Member
    • Jun 2007
    • 189

    #2
    Disregard - loss is reported on K-1 and dealt with at the partner level.

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    • ttbtaxes
      Senior Member
      • Jan 2011
      • 580

      #3
      What does their partnership agreement say? Let's use your example and assume there is $4,200 ($5,000- $800) of cash in the bank at year's end. if the company stopped and dissolved, would the partner B be obligated to repay $400 to the partnership?

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