Thanks so much for your answer. We know we're not required to complete Schedule L but Line 21 (Partner's Capital Accounts) and Schedule M-2, Line 9 are our QA check. We don't understand your "Interest paid comes out of cash but that should be done for you." comment. What do you mean?
Last year when we got the loans the Capital accounts balanced.
The EOY loan amount was listed on Line 19b as you stated.
For this year's returns the interest only was listed on Schedule L, Line 13, BOY and EOY.
We have entered the principal and interest combined for EOY on Schedule M-2, Line 2a (cash).
Line 2b (property) lists additions to basis, if any, for the year.
We can't get Schedule L, Line 21 EOY and Schedule M-2, Line 9 to agree.
The Partnership returns not involving a mortgage are coming out fine.
Since the returns with a mortgage are not balancing the Capital Accounts, we assume the problem is to do with the principle, interest or loan balance entries. The problems seem to be mortgage related.
Can you tell us what we are doing wrong? Please and thank you.
