taxit Posted September 15, 2008 Report Share Posted September 15, 2008 I have a client that set up an LLC as a disregarded entity. He has income and expense to report on a Sch C. He also had the disregarded entity become a partner in a partnership and received a K-1. Can I report the K-1 income on the Sch C or will there be a matching problem with IRS? Thanks for any opinions or experience with this. Quote Link to comment Share on other sites More sharing options...
Lion EA Posted September 16, 2008 Report Share Posted September 16, 2008 The LLC is disregarded. So, wouldn't you report the K-1 information as you would for an individual? Quote Link to comment Share on other sites More sharing options...
mcb39 Posted September 16, 2008 Report Share Posted September 16, 2008 The LLC is disregarded. So, wouldn't you report the K-1 information as you would for an individual? I agree with Lion. The K1 information should be reported on the Sch E, page 2. Use the K1 entry worksheet. Quote Link to comment Share on other sites More sharing options...
TAXBILLY Posted September 16, 2008 Report Share Posted September 16, 2008 I also agree. taxbilly Quote Link to comment Share on other sites More sharing options...
taxit Posted September 16, 2008 Author Report Share Posted September 16, 2008 I agree with Lion. The K1 information should be reported on the Sch E, page 2. Use the K1 entry worksheet. That is how I have entered the information. However, the client has other income and expense for the llc and I was hoping I could put it all on a Sch C. I posted because I thought if I did use Sch C for all of the income, there might be a mis-match of income since there would not be a Shc E, page 2. I will need to allocate the expenses between the Sch C and the Sch E. Thank you all for your your help. Gary Quote Link to comment Share on other sites More sharing options...
mcb39 Posted September 16, 2008 Report Share Posted September 16, 2008 That is how I have entered the information. However, the client has other income and expense for the llc and I was hoping I could put it all on a Sch C. I posted because I thought if I did use Sch C for all of the income, there might be a mis-match of income since there would not be a Shc E, page 2. I will need to allocate the expenses between the Sch C and the Sch E. Thank you all for your your help. Gary Is there any reason that you cannot put the "other" income from the LLC that is not allocated to the K1 on the Schedule C as well as the expenses? Why would there be a mismatch as the IRS knows which income is allocated to the K1, but you are on your honor for the Sch C income unless it is reported on 1099's. Also, remember that the expenses allocated to the K1 info go on the Sch E also as Unreimbursed expenses. Quote Link to comment Share on other sites More sharing options...
Lion EA Posted September 16, 2008 Report Share Posted September 16, 2008 Does the partnership operating agreement state your client will pay expenses without reimbursement? Did he, perhaps, get reimbursed or did his Schedule C get reimbursed? Quote Link to comment Share on other sites More sharing options...
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