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Final K-1

karzak
Level 3

Taxpayer has a final K-1 partnership.  Did not sell.  Just closed and stopped doing business.  Partners were brother and sister.  They had the business for 3 years.  Never made a profit.  Each put in $7500 start-up.  Only info on the K-1 is Ordinary loss ($402).  Receiving error in part 2.  Would this be considered a liquidated or abandoned? Just by checking abandoned, it frees up over $9000 in suspended loss carryover.  Do this seen right?

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1 Solution

Accepted Solutions
jeffmcpa2010
Level 11

Correct the beginning capital of the first year should be 0.

What they put in should show as Contributions on the Capital portion of the K-1.

There was nothing when they started - then they put it in.

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5 Comments 5
sjrcpa
Level 15

Why were the losses suspended?


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karzak
Level 3

passive loss rules

PATAX
Level 15

Did he already receive a deduction for the 7500 in the $9,000 loss? Just asking not sure... Just my opinion

karzak
Level 3

ok.  Now I am a little confused.  Taxpayer claims they put out $15,000 initially/$7500 each. Found Initial K-1 and it  has beginning capital account as zero.

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jeffmcpa2010
Level 11

Correct the beginning capital of the first year should be 0.

What they put in should show as Contributions on the Capital portion of the K-1.

There was nothing when they started - then they put it in.

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