1- How do the deductions for utilities and space work? In other words, can my deductions be different than my business partner deductions (each of us have their own homes, utilities, phones etc. and expenses for space and utilities are paid from our personal accounts separately). Expenses the partners are expected to pay personally and are agreed on by the partnership are reported on the Sch E page 2 on the personal tax return ONLY.
2- Should these expenses be listed on the K-1 schedule generated by the business and then applied on our personal tax filing? or there is no need to list these expenses on our business report (an hence will not be reflected on the K1 schedule) as each have different expenses which will lead to different deductions? On the personal return ONLY.
If this is your first filing of the 1065 I highly recommend you seek local professional guidance to get educated on all the rules. And if you are trying to complete the 2021 form 1065 then I hate to tell you the return is now LATE and accruing a penalty at the rate of $200 per partner per month since March ... and a local pro can help you with that as well.
