however, if schedule L on the K-1s is not completed the partners will still need to keep track of their tax basis.
losses in excess of tax basis are not deductible. distributions in excess of basic are taxable. should a partner inherit an interest the tax basis of the deceased partner is important if there will be a section 751/754 step-up. Also, should a partner dispose of their interest they'll need to know their basis to determine gain or loss.
there are worksheets available on the web for this purpose
I would point out that for S-Corps , starting a few years ago the IRS required form 7203 to be included under some circumstances. Many owners never kept track and have asked for help so they could properly complete the form. In some cases, this required them to go back to the first year of the corp for which they no longer maintained records. in the future, the IRS could require a similar form for partnerships.
