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How does a partnership limit losses a K-1 it received from another partnership

info2
Level 1

How does a partnership limit losses on a K-1 it received from another partnership. 


Partnership A has a 23% interest in Partnership X; 

Partnership X gives Partnership A a K-1 for a loss, with a capital account reduction equivalent to the loss. The loss ought to be limited since the A's basis in X is essentially 0. How do I limit it in the software for 1065's. 

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sjrcpa
Level 15

I believe in ProSeries you limit it by entering only the allowable loss. Then keep a side schedule of the loss in excess of basis for use in future years.

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taxiowa
Level 8
Level 8
You do not limit loss at partnership (1065) level.  That is done by the partners when they file.  If you are sure they have no basis, then you can attach a note to K1's that partner's basis may not be sufficient for this years loss.
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sjrcpa
Level 15

I believe in ProSeries you limit it by entering only the allowable loss. Then keep a side schedule of the loss in excess of basis for use in future years.

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