Partnership Agreement needed?

[sussigabel]

my husband and I got a small business loan in a Real Estate Holdings llc name. We lease the business Mikes Tavern from MSG Real Estate Holdings llc. The business closed in 2016. My spouse passed away in 2017. I pay the loan out of my personal income and we still own the property. Do I still need to file a partnership (K-1) for 2017 and going forward. I still have 15 years to go on the loan. Thank You for your help. 

[MichaelL1 · Accepted solution]

When the business closed in 2016, that 2016 return should have been the final return filed for the business.

Look to see if that return is marked "Final" and if not, you may want to Amend it, with the only change being, "Final" return. 

Sorry for your loss, also in 2017 when the partnership became one person, it is no longer a partnership, as must have two or more people as members.

The loan is considered now a personal debt. 

[sussigabel]

Thank You for your help. If I may ask, do I need to file a final K-1 forma 2017 since he didn't pass till Oct. Also I had to file bankruptcy after his death and they won't allow me to exempt the business loan because it is in the real estate holdings name. So they won't consider it a personal loan.

[MichaelL1]

If the business closed in 2016, then no 1065 for 2017 would be filed.  You would, however, show the cost basis of the business as a sale, --what is being done with property now?  Is it leased?

[MichaelL1]

or just an investment sitting there.

[sussigabel]

The business was closed and the property is just an investment sitting there

[MichaelL1]

No partnership return is needed for 2017 if business closed in 2016.

[sussigabel]

Thank You so much for all of your help.

[MichaelL1]

My pleasure