I am helping my son prepare
his 2015 federal taxes
. Last year he became a partner in the company he works for. He is a class B partner which is a profit-only member with no capital, redemption or liquidation value except for any accrued unpaid Profits Distributions
On his K-1, Part 1 Line G - General partner or LLC
member- manager is checked. Line K shows only an amount for Nonrecourse liabilities
Box 1 shows ordinary income
of $1027. He also receive a statement with the K-1 of a passive loss of -$3. So I reported the Passive loss of -$3 on Form
8582 on Worksheet 3, which was then transferred to Part 1 line 3b of Form 8582. Then I filled out Worksheet 5 and Worksheet 6 for the unallowed loss. Did I do this correctly? I am not sure if Worksheet 5 and 6 were necessary to fill out - or if the form 8582 is even necessary?
I then put $1030 (Box 1 of $1027 - (-3) = 1030) On Schedule E
, Part 2 line 28A Column j. I did not know what to check for line 28E - if any amount is not at risk. I assume it must be checked? His K-1 Box 12 also has a Section 179 deduction
which I first put on Form 4562
Part I and transferred the amount of $214 from line 22 of Form 4562 to Schedule E, Line 28A Column i. He also has K-1 Box 4 of Guaranteed payments of $1212 that I put on Schedule E on Line 28A, column j. Is this correct? Do I need to show the ordinary income and the guaranteed payments on separate lines on Schedule E line 28 A?
And Box 14 on the K-1 of Self employment earnings Code A shows $2242 (which I assume is the $1030 ordinary income plus $1212 guaranteed payments). Is this the amount I use on Schedule SE
, or can I reduce that figure by the $214 of Section 179 deduction?