Where do I put my husband and I's income on our 1065? We own our company 50/50 as a partnership but we don't make the same amount. We are also not employees.

[lng22392]

We don't file W-2's, we just pay ourselves based on the comissions we make. I'm using turbotax business and I'm not sure where to put what we made or if it calculates it as is. We don't take profits 50/50 though.

[Carl]

With a 1065 return, the partnership reports the income. In other words, all income paid to to the partnership, is reported by the partnership as income "to" the partnership, not to the individual partners.  Whatever funds the individual partners take out of the partnership is called distributions. The partnership will then issue each individual partner a K-1 that shows what that partner was "distributed" by the partnership. Each partner will need their individual K-1's for their personal 1040 tax return.

[M-MTax]

You don't have to file as a partnership...you can file as a QJV....https://www.irs.gov/businesses/small-businesses-self-employed/election-for-married-couples-unincorpo... you're a married couple. If you've been filing as a partnership in the past then you should know the income is reported as gross sales or receipts.....Line 1a on your 1065 and you're taxed on the business income on your K-1s whether you made distributions or not.

[lng22392]

Thanks Carl! I guess I should ask, the distributions on are K-1 are reflected by ownership percentage, but that's not how we pay ourselves. We work on commission so my husband made a bit more than me last year. Our K-1s are split 50/50 and I'm not sure where to change this.

[Carl]

The simplest thing to do, is under the Partner/Member Information tab you need to work through each individual partner. You can change the percentage for each partner on the "Enter Partner Percentages" screen. You have to do this for each individual partner and the percentages for "profit" must total to 100%, while the percentages for "loss" as well as the percentage of ownership must all total 100% each. So you can see that the profit and loss percentage does not have to be the same as the ownership percentage.

[AmeliesUncle]

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@lng22392 wrote:

 that's not how we pay ourselves. We work on commission so my husband made a bit more than me last year. 

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Payments based on your actual work performs are usually "Guaranteed Payments".  Look for that.

[tagteam · Accepted solution]

I agree with @AmeliesUncle; these are guaranteed payments.

[lng22392]

This is the right spot, however whenever I export the K-1s, its just splits our earnings 50/50. Anyone know how to fix it so it reflects what we owe?

[Critter-3]

What is left after the guaranteed payments should be 50/50.  If this is your first 1065 then I highly recommend you seek local professional guidance to get educated on what you have.