Parntership follow up question....

[AZ-Tax]

Josh, I talked to Karen Black @ Atlas

She insisted and was very confident that K-1 box 13 code I should flow to Part 2 of Sch E under "nonpassive income and loss" column and flow to Ln 17 front page as a negative amt.

My software currently shows the amt in box 1 of K-1 in Part 2 of Sch E but under "passive income and loss" in column f (loss allowed K-1). How about yours?

I suggest you call her @ 800-251-0171 Ex 3150. I am curious what you think.

[JoshinNC]

Box 1 and Box 13 are different amounts on my client's K-1

She insisted and was very confident that K-1 box 13 code I should flow to Part 2 of Sch E under "nonpassive income and loss" column and flow to Ln 17 front page as a negative amt.

My software currently shows the amt in box 1 of K-1 in Part 2 of Sch E but under "passive income and loss" in column f (loss allowed K-1). How about yours?

I suggest you call her @ 800-251-0171 Ex 3150. I am curious what you think.

I have a gain in Box 1 of $1505 and an amount of $50,000 (original investment) in Box 13 with Code I. I will give her a call.

Thanks!

[AZ-Tax]

Josh...I got my software to display as Atlas says...

I have a box that ask if they "materially participated" and when I checked it, wala, the amounts appear in part 2 of Sch E under non passive and the amount on Ln 17 of pg 1 of 1040 equals an amt between the positive number on K-1 13/I and the negative number on 14/A. This is my client first year in this partnership which I understands makes difference from those that are not in the partnership for the first year.

I plan on having my client sign a document excluding me from any penalties and/or interest regarding this deduction. Also, my client brought in completed K-1's for NY, WV and PA.

My software vendor says I need to file those states as non resident. I emailed Karen Black to get her opinion.

[JoshinNC]

My Box 1 amount is in nonpassive income

but the box 13 amount is not going to the Sch. E in any column. I'll call her after my next appt. and see what she says.

[JoshinNC]

My research has led me to the determination that

the original invesment is either deductible in the year of the investment or amortizable over 60 months at the TP's discretion. I am amending the return to reflect the investment as a deduction against his W-2 income.

Learn something new every day!

[AZ-Tax]

Josh.....did you recieve my email?

Josh, in an email to you, I mentioned that I had my client sign a letter. Did you receive it? I attended Chris Bird seminar last year and he said you can never get enough signatures from your clients. CYA, CYA, CYA.......