New LLC Partnership filing a 1065

[CCCBuilder]

Hey all, I am wanting to know if there is a fairly simple way to file LLC Partnership taxes? I formed an LLC with one partner in 2019. This will be our first year filing to get the 1065 Schedule-K? I think.  Our business is in building, and the 2019 year will report as a loss just due to startup costs and buying tools with our one job not being completed quite yet.

I was told that if we have any expenses like tools that filling out the 1065 is extremely difficult, this was by a local CPA though and I don't know if they are trying to get my business or if it's truly above my head?  I've always filed my own taxes, and was thinking TurboTax had a feature for this but again the CPA said not to use TurboTax for some reason or another.  Just trying to get both sides of the story here.

[tagteam]

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@CCCBuilder wrote:

This will be our first year filing to get the 1065 Schedule-K? I

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Your CPA is substantially correct in the sense that properly preparing a Form 1065 and associated K-1s for a multi-member LLC can be challenging, particularly in its initial tax year.

Intuit produces TurboTax Business (link below) that is capable of preparing a Form 1065 for a multi-member LLC; it must be installed and run in a Windows environment (there is no Mac nor Online version).

However, you might want to have your 1065 professionally prepared the first year in operation to ensure that it is done correctly. Subsequently, you can use that first year return as a template of sorts if you feel comfortable preparing the return yourself.

https://turbotax.intuit.com/small-business-taxes/

[Anonymous]

I agree with Tagteam.      there are many tax laws affecting your LLC .   for example the section 195 election to deduct start up costs.    failure to make this election , the IRS could disallow any deduction for these.   do the tools qualify under the de minimus rules or is it better not to deduct fully in first year because you'll be in higher tax bracket next year.  you are doing a project  that might be subject to the cost capitalization rules.  do you know these tax laws?   

[Carl]

I would highly recommend for your first year that you have a CPA prepare the 1065 partnership return with the understanding that you will sign and mail it yourself. Also make it clear to the CPA that you want a copy of *EVERYTHING*. All forms and calculation worksheets.

Then once you get that from the CPA you can use it to prepare your own 1065 Partnership Return using TurboTax Business. This will help you immensely in the learning process, which should not be that difficult for you (though it won't be easy-peesy either). Best part as, as you're working it through the business program, if you have questions (and rest assured you will!) you can always ask them here. You're not gonna learn this stuff through osmosis!

[Carl]

One more thing to, and this is "REALLY" important.

Your 1065 Partnership Return is due March 15th. The late filing penality for that is $200 per month, per owner. So if you file it on March 16th, you're looking at a minimum late filing fee of $400. So *don't* *be* *late*.

[Heffleysatyahoodotcom]

I purchased a rental house in 2011 for $213k, basis at 80% = $170k. I have taken depreciation over the years of $46,193, basis now is $125k.  I setup a new LLC as of 1/1/2019 with this rental as the only asset. FMV now is $300K.  What value do I enter in TurboTax Business Form 1065? Thank you.

[RobertG]

Are you talking about the Partnership's basis in the property?

According to IRS Publication 541 "If a partner contributes property to a partnership, the partnership's basis for determining depreciation, depletion, gain, or loss for the property is the same as the partner's adjusted basis for the property when it was contributed, increased by any gain recognized by the partner at the time of contribution."

In other words, the Partnership's basis is your basis.