Partnership capital accounts tax basis

Forum|Forum|5 years ago
February 8, 2021
2 replies
21 views

Is anyone going to disclose the beginning capital account method with the K-1's?

I received 3 K-1's today for a client from another firm and each had a supplemental statement

BEGINNING CAPITAL ACCOUNT METHOD USED - TAX BASIS

Can this be generated in Lacerte automatically of would use Screen 31 Supp info all partners?

Or not at all?

Thanks

Lacerte Tax

This topic has been closed for replies.

sjrcpa

Level 15

Yes I'm disclosing. It is required.

The more I know the more I don’t know.

S

safcpaAuthor

Level 3

Are you using supplemental info for input or is there something in Lacerte to check t generate it

Thanks

J

jphandy

Level 3

SAF:

Lacerte can print a note on page two of the K-1 noting that Box L is now tax capital basis as the regulations require.

The current problem is; if Schedule L and Schedule M-2 remain on some other basis such as GAAP, Sec 704(b) book Lacerte will not allow different amounts in Box L, K-1.

IRS instructions require beginning capital to be "tax capital basis" as we know, however any change to Box l will force a change to Schedule L and M-2. This is a flaw in the program, Intuit engineering refuses to address this until enough users revolt.

To comply with the new regulation, you have to force an adjustment in the balance sheet and M-2

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