This article will help you specially allocate unrecaptured Section 1250 gain from a disposition of business assets (Schedule K-1, box 9c), other than the profit sharing percentage entered in Screen 8, Partner Percentages.
Follow the steps below:
- Go to the Detail tab > then Screen 29, Special Allocations.
- Select Income (Sch. K-1, Boxes 1–11) from the left section menu.
- Select Unrecaptured Section 1250 Gain.
- Select Disposition of Business Assets.
- If this is from a K-1, use From Passthrough Entities in the same section.
- Select the Allocation Method from the dropdown (Lacerte will default to amount).
- Allocate the amount as per the partnership agreement.
- If applicable, allocate the Section 1231 Gain(Loss); the unrecaptured section 1250 gain from a sale of business assets is a part of this gain.
- To confirm the allocation, view Box 9c on the Schedule K-1 in the Forms tab.