This is perfectly doable with TurboTax. But you "REALLY" have to know what you're doing.
Basically, the partnership will be filing it's "final" 1065 return and will be closed/dissolved permanently and forever. You can "NOT" reuse the EIN for that partnership either. It's retired permanently and forever. Several criteria have to be met for this partnership to "truly" be dissolved.
- If the partnership carried an inventory, then the EOY Inventory balance *MUST* be zero.
- If the partnership has any assets, then all assets "must" be disposed of by the partnership. Generally for your situation, they would be shown as distributed to any of the departing partners. (Yes, **YOU*** are also a departing partner from this partnership, since a partnership can not exist with only one member.)
- If any vehicle use was claimed/reported by the partnership on the 1065, even if that use was less than 100% business use, then you must show disposition of the vehicle. Be it sold, distributed, given away, destroyed, casualty damage, whatever.
Now on your 1040 SCH C here's some things that are important.
- The start date of the business will be the date the "the business" (meaning "the partnership") was open for business. Doesn't matter that it was a prior year either.
- The "in service" date for all assets will be the original date that asset was placed in service in the partnership. Doesn't matter that it was a prior year either.
If inventory is involved, then the BOY Inventory balance *MUST* be zero. There are no exceptions.
Now here's a question I can't answer.
- Who gets what part of prior depreciation taken in the partnership already, on distributed assets? Since prior depreciation was split between the partner's each year, who gets what amount? How is it accounted for? My "guess" is that if you only get half the depreciation, then you will claim only 50% business use on your SCH C for the period of time that asset was in the partnership. Then you claim 100% business use starting one day "after" the partnership dissolved. But this is just a guess.
