I think, although I could be wrong, that you need to go back to the companies that issued the K-1s and ask for separate K-1s that split up the earnings and expenses. You can't be joint taxpayers and separate taxpayers at the same time.
Side question, you do know that married filing separately is generally terrible, right? It is almost always better to file jointly unless something else is going on.
I also think that, if you get separate K-1s you can still file jointly, you just can't file separately if you have joint K-1s. In other words, if you are 50% owners of a company, you could get one K-1 for 50% ownership, or two K1-s for 25% each. You could still file a joint return reporting both of the 25% K-1s.
It's complicated, but my accountant can break up the K1's I don't see why TT shouldn't be able to.
Sigh, I guess that's why I use an accountant. I was hoping to use TT this year to make our lives a bit simpler. All responders gave been very helpful, but the, alas, the software did not contemplate all the variations on a theme. Onward.
" I don't see why TT shouldn't be able to." Keep in mind that TT is a computer program that is designed to fit the needs of most folks who prepare their own tax returns. However, it does not cover all situations.
SweetieJean, Thanks for your answer. I realize TT is a basic program, but splitting income 50/50 is not a sophisticated act. Tell me that TT can't handle a business situation where some income, depreciation and transfer pricing challenges from Japan, Mexico and East Transylvania, I'd say yes, that's over the top. Splitting income that's reported neatly on a standard IRS form 1099 or 1065, I'd say what's the big deal. But I appreciate what $100 buys to be sure.
Well TT cannot but you can split all the entries yourself and just enter 1/2 on each tax return ... however the person whose SS# is on the K-1 will most likely get an IRS letter wanting to know where the other 1/2 of the income went.
If you cannot agree to file a joint return then maybe a compromise can be reached. The person whose SS# is on the K-1 reports all of the income & the other person reimburses them for 1/2 the extra tax incurred. To compute this simply enter everything EXCEPT the K-1 ... look at the bottom line ... then add the K-1 ... and look at the bottom line again ... the difference is the extra tax liability so divide in 2.