Client/Partner Info & Percentages

Facts

Enter the following information for a sample client:

Partner Information	Data entry:
Partner Name	Partner 1
Type of Entity	Corporation
Partner Name	Partner 2
Type of Entity	Individual
General Partner?

Enter the percentages for end of year profit, loss, and capital for each partner.

View page 1 of Form 1065 and note the insertion of the fiscal year dates at the top and that the program automatically completed question I based on the number of partners entered. View the bottom of page 2 of Form 1065 and note the insertion of the Tax Matters partner. Also view Schedule K-1 for each partner. Note how the input affected lines I - L on each K-1.

Program Considerations

Client Information:

• The program determines the beginning and ending dates of the fiscal year based on the entry in the Fiscal Year End field. Enter the month for the fiscal year end (the program defaults to 12).
• Select cash, accrual, or other as the accounting method used by the partnership.
• Select the type of entity from the list. If you select Other, enter the description in the Type of entity filing if 'Other' field in Screen 3, Miscellaneous Information.
• Enter the partner number of the Tax Matters Partner. This information prints at the bottom of Schedule B.

Partner Information:

• The program assigns each partner a number based on the order in which the partners are entered and based on the option for Subclient Addition. This option is found in the Program Options section of the Setup tab and is used to determine the order in which the program adds new partners. Selecting Append to End adds new partners to the end of the existing list. The program assigns the next highest available number. Selecting First Available Slot adds new partners in the lowest available position in numeric order. If gaps exist in the current numbering, the program assigns new partners the numbers within the gaps before adding partners to the end. The following Partner Information entries are mandatory:
• Partner Name
• Identification Number
• Street Address
• City
• State
• Resident State

• Select the type of entity for each partner entered and select the correct partner designation. The program uses these entries to classify the partner for the Analysis by Type of Partners on Schedule K, Form 1065 (and state equivalent), and to print partner information on Schedules K-1 and state Schedules K-1 (or equivalents).

Partner Percentages:

• Enter the profit sharing, loss sharing, and ownership of capital percentages, in xx.xxxxxx format at the end of the year. This information prints on Schedule K-1, Line L. The program uses these entries to calculate the partner distributions.
• You are required to enter the Profit Sharing, Loss Sharing and Ownership of Capital percentages in the Before Change/Termination (Beginning of year) section of the grid ONLY if there has been a change or termination during the tax year.

How?

To enter partners:

1. Open the sample client.
2. Open the Partner Information screen.
   
3. Enter the information from the Partner Information table above in the appropriate input fields.

To add partners:

1. Click the Add button at the bottom of the Partner list.
   

To enter partner percentages:

1. Open the sample client.
2. Open the Partner Percentages screen.

   Note: You cannot enter percentages before adding partners.

3. Enter the information from the Partner Percentages table above in the appropriate input fields.
   
4. Repeat for each partner.

   Note: You are required to enter the profit sharing, loss sharing, and ownership of capital percentages in the Before Change/Termination section ONLY if there has been a change or termination during the tax year.

Tips & Shortcuts

• You can press [Ctrl]+[A] to add partners.
• When entering partner percentages, the program totals them at the bottom of the grid. They should always add up to 100.

Review

You should have entered the client information, partner information, and partner percentages in their respective input screens and produced the following results on the Schedule K-1's (select each partner within the Description list box):

Troubleshooting

Problem: I'm getting 0.25% and 0.75% on Line L for the K-1's.

Solution: You must enter the partner percentages in xx.xxxxx format and they must total 100.

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