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am0rningview
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Joined: 10 Mar 2011
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Posts: 37

Posted: 13 Mar 2011 at 20:55 \| IP Logged

When considering the effect of separately stated income
items with limitations on the individual level, such as
capital losses, charitable contributions, and investment
interest expense, are you supposed to take these
limitations into account BEFORE determining what amounts to
report on the partner's K-1 and calculating the effect of
each item on the partner's outside basis? Or, do you simply
report the full amount of each item on the K-1 and subtract
them in full when calculating the change in each partner's
basis?

almurra1
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Joined: 13 Mar 2011
Location: United States
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Posts: 35

Posted: 13 Mar 2011 at 21:50 \| IP Logged

I believe that with the exception of guaranteed payments,
all other things (e.g. capital losses, charitable
contributions) flow straight through to the 1040 with the
K-1 information (partnership profit % - guaranteed pmts)
reported on the 1040 from Schedule E. You may want to
double check, however. Good luck.

__________________
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B.S. Accounting and B.S. CIS
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almurra1
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Joined: 13 Mar 2011
Location: United States
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Posts: 35

Posted: 13 Mar 2011 at 22:05 \| IP Logged

I should clarify, those items you listed (interest income,
passive income, dividend income, cap gains/losses,
charitable contributions) are reported on the K-1 at their
share of that flow-thru item. I hope that makes sense.

__________________
FAR-86
BEC-90
AUD-89
REG-78 (Not pretty, but I'll take it!!!)
B.S. Accounting and B.S. CIS
Master of Accounting
Becker CPA Review Course
Arizona

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