Level 4

Partner's Outside Basis vs. At-Risk Basis

Forum|Forum|3 years ago
October 18, 2022
1 reply
35 views

If a partner has a $50,000 negative capital account at year end, and the partner's share of debt is:

Recourse Debt: $5,000
Qualified Nonrecourse Debt: $250,000
Nonrecourse Debt: $12,000
Negative capital account: ($50,000)

What is the partner's outside tax basis?

What is the partner's at-risk basis?

Thanks,

Michael

Partner's Tax Basis

This topic has been closed for replies.

T

TaxGuyBill

Level 15

@mhlester wrote:

capital account

Was this an original Partner from the start of the Partnership? If not, Capital Account has little or no effect on things.

M

mhlesterAuthor

Level 4

Yes, the original partner who invested cash only at inception, and who during the course of the partnership received debt financed distributions.

rbynaker

Level 13

The only way to know is to go back to the beginning of time and create a basis worksheet for each year.

https://www.irs.gov/pub/irs-pdf/i1065sk1.pdf

PDF page 3 (or just google, you can find plenty online or use the IRS one to make your own spreadsheet.)

In a perfect world the partner has all of this information. Here in the real world you might get lucky and the partnership accountant can get you most of the information.

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