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K-1 Special Allocation

Roz1
Level 2

I have a 1065 filing where a bonus was paid out, but the expense needs to be allocated to only two of the members.  (They paid for the expense out of their proceeds.)  

Spent over an hour w/a tech from Pro Series trying to solve this.  Could not.

Trying not to have to manually input this.

 

Thank you!!!!

 

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Mark304
Employee
Employee

Based on my understanding of your scenario you will need to specially allocate the amount on line 1 of the Schedule K of your Form 1065.  Line 1, is the ordinary income of the partnership where the bonus compensation expense would be recorded along with other income and expenses of the entity.

You will need to calculate each partner's share of the amount on line 1 of the Schedule K and allocate the appropriate amount on the Sch K-1 Wks in the "Special Allocations" section.  I am attaching a link to some documentation that can help you with special allocations.  There are some tricks in there for residual allocations that may be useful to you.

https://proconnect.intuit.com/community/form-1065/help/how-to-enter-special-allocations-to-partners-...

 

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Mark304
Employee
Employee

Based on my understanding of your scenario you will need to specially allocate the amount on line 1 of the Schedule K of your Form 1065.  Line 1, is the ordinary income of the partnership where the bonus compensation expense would be recorded along with other income and expenses of the entity.

You will need to calculate each partner's share of the amount on line 1 of the Schedule K and allocate the appropriate amount on the Sch K-1 Wks in the "Special Allocations" section.  I am attaching a link to some documentation that can help you with special allocations.  There are some tricks in there for residual allocations that may be useful to you.

https://proconnect.intuit.com/community/form-1065/help/how-to-enter-special-allocations-to-partners-...

 

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sjrcpa
Level 15

The answer is still the same.

Special k-1 allocation - Intuit Accountants Community 

Wait til you have to do it for every line on a K-1 for 100+ members.


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