Partnership has 2 partners 50/50 but one of them is profit/loss only (limited partner).
Income after GP is $6,000, so each capital acct. would increase by $3,000.
But income includes 179 deduction of $1,000 which will be allocated to working partner, none to limited partner. I am fine as far as basis calculation goes but confused about the capital accounts. I would allocate 179 deduction fully to partner who receives benefit on
K-1 but my software program reduces capital accounts for both equally.
Can anyone confirm that I am thinking straight (or set me straight)? Thanks.
Income after GP is $6,000, so each capital acct. would increase by $3,000.
But income includes 179 deduction of $1,000 which will be allocated to working partner, none to limited partner. I am fine as far as basis calculation goes but confused about the capital accounts. I would allocate 179 deduction fully to partner who receives benefit on
K-1 but my software program reduces capital accounts for both equally.
Can anyone confirm that I am thinking straight (or set me straight)? Thanks.
Comment