Pacun Posted September 5, 2015 Report Share Posted September 5, 2015 I have a client who shares 50% of partnership. He does all the work so he has 90K each year as guaranteed payments. This year the company made $100K so his K1 shows 5K ordinary business income line 1 and 90K as guaranteed payments on line 4. On line 14 Self-employment earnings (loss) the K1 has two entries:A 95KC160KIs that a mistake since the partnership didn't make more than 100K even with the other partners income? Quote Link to comment Share on other sites More sharing options...
jklcpa Posted September 5, 2015 Report Share Posted September 5, 2015 I have a client who shares 50% of partnership. He does all the work so he has 90K each year as guaranteed payments. This year the company made $100K so his K1 shows 5K ordinary business income line 1 and 90K as guaranteed payments on line 4. On line 14 Self-employment earnings (loss) the K1 has two entries:A 95KC160KIs that a mistake since the partnership didn't make more than 100K even with the other partners income? It's not a mistake. Line C is the gross farm, or nonfarm, income allocated to the partner. The total of this line for all partners' shares would tie to line 3 of the 1065 and line 14c on page 4. 5 Quote Link to comment Share on other sites More sharing options...
Pacun Posted September 8, 2015 Author Report Share Posted September 8, 2015 I am glad 3 people like your answer because I was about to reject the K1 because I thought that that entry in Box 14 C is for farm income. After I went to ATX and I enter the information, Box 14 code C is for "gross receipts", which doesn't play in tax calculation. So I guess the K1 is correct. 1 Quote Link to comment Share on other sites More sharing options...
jklcpa Posted September 8, 2015 Report Share Posted September 8, 2015 Sometimes it takes a village...? 2 Quote Link to comment Share on other sites More sharing options...
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