Partnership Tax Questions and Answers

Can an S corporation or a partnership pass through a §179 deduction on its Schedule K-1 if it has a loss on Line 1, Ordinary Income/Loss?
In some instances. Both an S corporation and a partnership are subject to the taxable income limitation when computing the amount of §179 which can be passe...
Sun, 5 Feb, 2017 at 9:11 PM
The taxpayer is a partner in a partnership. He has suspended losses due to basis limitations. He received a final K-1. Is the taxpayer allowed to use the suspended losses due to the basis limitation or are they lost?
The losses are lost. Losses suspended due to basis are not freed up until the partner injects more capital or has pass-through income which would increase b...
Sun, 5 Feb, 2017 at 9:11 PM
​Is an LLC required to notify the IRS if the number of members changes (e.g., from multiple members to one member)?​
No. An LLC is not required to notify the Service (i.e., IRS) if membership changes from multi-member to single member or from single member to multi-member ...
Sun, 5 Feb, 2017 at 9:12 PM
Taxpayer is a general partner in a partnership, but participates very little. Is the pass-through ordinary income from the partnership subject to self-employment tax?​
Yes. General partners are automatically subject to self-employment tax, regardless of how much they participate. Net earnings from self-employment equals gr...
Sun, 5 Feb, 2017 at 9:13 PM