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Not applicable
posted Feb 24, 2020 6:55:04 PM

Final K-1 Percentages wrong

One of the partners left our partnership this past year so I am doing a final K-1. The remaining partner percentages are correct(100%) but the leaving partner shows the same percentage in starting and ending even though the ending percentage should be 0%. I have checked the page where I enter the beginning and ending ownership percentages and that page is correct. I can not find a way to edit the K-1 directly to correct the issue.

0 6 4092
6 Replies
Level 15
Feb 24, 2020 7:38:12 PM

Did you indicate that there was an ownership change in the program? 

 

Click the Business Info tab, click About Your Business, and then scroll down to the last item, "Has an Ownership Change?".

Returning Member
Mar 6, 2020 6:10:16 AM

I have the same issue. And I did indicate a change of ownership in the program!

Not applicable
Mar 6, 2020 2:27:13 PM

Yes, I did enter an ownership change. And the remaining partner's totals are correct. The ending percentage is 100%.

Expert Alumni
Mar 7, 2020 10:25:33 AM

Note that a partner who left the partnership during the year should show the percentage they owned at the time they left, not zero.   According to the IRS Instructions for Form 1065 K-1 at this link, and copied here:

 

“Generally, the amounts reported in item J are based on the partnership agreement. If your interest commenced after the beginning of the partnership's tax year, the partnership will have entered, in the Beginning column, the percentages that existed for you immediately after admission. If your interest terminated before the end of the partnership's tax year, the partnership will have entered, in the Ending column, the percentages that existed immediately before termination.” (emphasis added)

New Member
Mar 17, 2022 4:12:53 PM

Thanks for this, working on a 2021 tax, I was thinking that this behavior was a bug! I even called the help desk, they were of no help with this, I can’t really fault them, however. Anyhow, your post was very helpful!

Level 1
Mar 12, 2024 7:07:36 PM

This software is absolute garbage.  I had the same problem.  The interview doesn't even establish shareholder contributions, distributions or capital account balances.