This year, our tenant included the security deposit in their 1099-MISC (we extended the lease for 5 year and required an additional Security Deposit). I am NOT considering this income and have consulted with the IRS website as well as experts here to confirm that it can be treated as a long term liability. As such, Box 1 of my k-1 has a negative value for income/loss. This is a REAL ESTATE BUSINESS. My husband and I are the Landlords, we each generate a K-1 in a typical year.
As many have discussed here, TT requires me to go through the Sch k-1 screens for each entry in Box 1 and Box 2 (there is nothing in Box 3).
Here are my questions:
For all the subsequent information requested on TT screens once I get past the Box 1,2 or 3 screen; do I only enter those data points for one and leave them blank for the other?
Currently, I entered a K-1 with all the other data points with the Box 2 information and then added another k-a and ONLY entered the negative value for Box 1 and left all the other entries blank.
QUESTION 1: Is this correct? If not, which boxes get entered for Box 1 and which for Box 2?
QUESTION 2: When adding an additional K-1; TT asks about Capital Account information - that information is already included in the first k-1 I entered (in fact last years numbers were imported in since we have used TT last year)
Thank you in advance.
