I have 2 separate mortgages on 2 separate rental properties and these are listed on my TT balance sheet. On the K-1's, they are assigned as "Qualified Non Recourse Financing". Previously, when my CPA did my taxes, this debt was listed on the K-1's as "Recourse" debt. I spoke to them and their logic was even though the bank will foreclose on the property should I default on the loan(s), they can still come after me personally. Is there a way to assigned this financing or input this debt amount as a mortgage in the balance sheet and have it listed as "Recourse" debt on the K-1 instead of "Qualified Nonrecourse financing"? If not, how do I input it so it will show as "Recourse" debt on the K-1?
You should be able to change that figure in the Balance Sheet section of the program.
Under "Forms" the total amount for the 2 mortgages shows correctly under the balance sheet (Form 1065 p4-5 on line 19b). At the bottom of the page in the section labeled"Partners' Liabilities Smart Worksheet", it will not allow me to change it from Qualified nonrecourse to recourse. Is there another location where it can be changed that I am missing ?