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New Member

How do I enter a home office deduction for a partnership

 
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Accepted Solutions
PatriciaV
Expert Alumni

How do I enter a home office deduction for a partnership

There is no Home Office Deduction for a business tax return. Instead, a business may have office expenses (including an office building).

As the owner, however, you may be able to claim the Home Office Deduction on your personal tax return.

If you were required to pay these expenses under the partnership agreement, you may report your home office expenses on Schedule E (Partnership Income) as "Unreimbursed Partnership Expenses" (UPE). In this case, TurboTax will ask you about UPE (see screenshot below - click to enlarge), with follow-up entry at the end of the Schedule K-1 input.

But if the partnership agreement specifically states that the partnership has a non-reimbursement policy when expenses are incurred outside of the partnership or that it does not specifically require partners to pay for certain expenses, the deduction may be disallowed at the partner level. 

See instructions for Form 1040, Schedule E for more info from the IRS.

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2 Replies
PatriciaV
Expert Alumni

How do I enter a home office deduction for a partnership

There is no Home Office Deduction for a business tax return. Instead, a business may have office expenses (including an office building).

As the owner, however, you may be able to claim the Home Office Deduction on your personal tax return.

If you were required to pay these expenses under the partnership agreement, you may report your home office expenses on Schedule E (Partnership Income) as "Unreimbursed Partnership Expenses" (UPE). In this case, TurboTax will ask you about UPE (see screenshot below - click to enlarge), with follow-up entry at the end of the Schedule K-1 input.

But if the partnership agreement specifically states that the partnership has a non-reimbursement policy when expenses are incurred outside of the partnership or that it does not specifically require partners to pay for certain expenses, the deduction may be disallowed at the partner level. 

See instructions for Form 1040, Schedule E for more info from the IRS.

dittybag
Level 2

How do I enter a home office deduction for a partnership

I am a limited partner with UPE related to an office I maintain for the convenience of the partnership. THis is acknowledged in correspondence from the Partnership at the time I joined. However, the "sceenshot" you refer to does not show up. How do I post these expenses? The Turbotax tool does not prompt for these expenses.

 

Also, the fund pays income to limited partners providing service to the fund. This is reported out as W-2 income, re-imburseable expenses are payed under a qualified plan.  However, we use a thrid party employment company to handle HR and income reporting, so the W-2 income is seperate from the K-1. How do I connect my w-2 income and my unreimbursed expense so that I dont run into limits on the Business income from the activity.  The services to the fund create active income and expense not recognized on the K-1.

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