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Screen K1Misc - Partner Schedule K-1 Items (1065)
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Overview
Partner Percentages
Profit sharing - beginning / ... / Loss sharing - ending
The application automatically sets the beginning-of-year and end-of-year profit and loss percentages on Schedule K-1, Item J based on the first and last day a partner owns an interest in the partnership. This information comes from the Changes of Ownership window in Partner Data Entry. To use a different percentage in the Beginning or Ending column, select the Ptr Alloc buttons. To display text, such as Various or Formula, use the Description fields.
note
Electronic filing guidelines don’t allow text in the partner percentage fields. The calculated percentage will be used in the electronic file.
Ownership of capital - beginning / ending
The application displays the beginning-of-year and end-of-year capital percentages for Schedule K-1, Item J as follows.
- By default, the application displays the ownership of capital percentages based on the 1st and last day a partner owns an interest in the partnership, using information entered in the Changes of Ownership window in Partner Data Entry.
- If theCompute partner end-of-year ownership percentage based on ending capitalfield in this screen is marked, the application calculates the end-of-year capital percentage based on the partners' share of ending capital as of the last day of the partnership's tax year.
- To use a different percentage in the Beginning or Ending column, select thePtr Allocbuttons. To display text, such as Various or Formula, use the Description fields.
note
Electronic filing guidelines don’t allow text in the partner percentage fields. The calculated percentage will be used in the electronic file.
Deductions - beginning / ending
The application automatically sets the beginning-of-year and end-of-year deductions percentages on Schedule K-1 (Form 8865), Item E to match the Profit percentage from the Changes of Ownership window in Partner Data Entry for the first and last day a partner owns an interest in the partnership. To use a different percentage in the Beginning or Ending column, select the Ptr Alloc buttons. To display text, such as Various or Formula, use the Description fields.
note
- Electronic filing guidelines don’t allow text in the partner percentage fields. The calculated percentage will be used in the electronic file.
- These fields apply only to Form 8865.
Display Schedule K-1 partner percentages using the partnership's tax year
The application defaults the beginning-of-year and end-of-year profit, loss, and capital percentages for Schedule K-1, Item J to the 1st and last day a partner owns an interest in the partnership, using information entered in the Changes of Ownership window in Partner Data Entry. For example, if a partner joins the partnership after the beginning of the partnership's tax year, the beginning-of-year percentages displayed on Schedule K-1 will be the partner's percentages as of the day the partner joins the partnership, not 0 percent. Enter
X
to display the partners' percentages as of the beginning and end of the partnership's tax year. In the previous example, if you enter X, the beginning-of-year percentages on Schedule K-1, Item J for the new partner will all be 0 percent.To automatically display Schedule K-1 percentages using the partnership tax year for all new clients, mark the
Display Sch K-1 percents using partnership tax year (K1Misc Screen)
checkbox in the Return Presentation
tab in the New Client Options
window. To open this window, select Setup
, then 1065 Partnership
, then select New Client Options
.Compute partner end-of-year ownership percentage based on ending capital
Enter
X
to automatically calculate Schedule K-1, Item J, Capital based on each partner's ending capital account balance.The application calculates the end-of-year capital percentage as follows.
- If all partners' ending capital balances are greater than or equal to zero, the application calculates the capital percentage for each partner by dividing each partner's share of ending capital by the sum of ending capital for all partners.
- If any partner's ending capital is less than zero, the application calculates the capital percentage for each partner based on whether the partner's ending capital is greater than or less than zero.
- For any partner whose ending capital is less than or equal to zero, the application calculates the capital percentage as 0.000000 percent.
- For any partner whose ending capital is greater than zero, the application calculates the capital percentage by dividing the partner's share of ending capital by the sum of ending capital for all partners whose ending capital is greater than zero.
To automatically calculate Schedule K-1, Item J for all new clients, mark the
Compute partner's ownership percent based on ending capital (K1Misc Screen)
checkbox in the Return Presentation tab in the New Client Options
window. To open this window, select Setup
, then 1065 Partnership
, and select New Client Options
.Partner Share of Liabilities
Exclude / Include deemed distributions from a decrease in ptr liabilities in partner capital (force)
Deemed distributions from decreased partner liabilities affect partner capital calculations based on your settings.
- SelectSetup,1065 Partnership, thenOther Return Options.
- Select theReturn Presentationtab.
- Deemed distributions resulting from a decrease in partner liabilities are:
- included in the calculation of partner capital when theExclude deemed distributions in the calculation of partner capitaloption isn't selected
- are excluded in the calculation of partner capital when the option is selected.
Use this field to force the current client to
X-Exclude
or I-Include
deemed distributions in the calculation of partner capital regardless of the Other Return
option selection. Include supplemental liability schedule with Schedule K-1?
By default, the application generates the at-risk and not at-risk supplemental schedule on Schedule K-1, Other information when you allocate a not at-risk liability to a partner. Use the drop-down to force the application to always print or to never print.
Accounts payable rounding adjustment classification
By default, the application automatically classifies the accounts payable rounding adjustment amount as a recourse liability that is at-risk. Enter the accounts payable rounding adjustment code to classify the adjustment as a different type of liability.
Other Information
Primary activity and unit for data share by activity
Enter the partnership’s primary activity and unit number. When data sharing by activity into 1040 and 1120, the application uses this information to determine which unit will be the primary unit for the combined basis calculation.
note
The application lets you share Schedule K-1 financial data among all 1040, 1041, 1120, and 1065 clients automatically. (The application can transfer financial data
into
1120C clients, but not out of
these clients.) For details, see Data sharing overview.