1065-US: Entering information for Schedule K-1, item L to report partners' capital

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Question

Where do I enter information for Schedule K-1, item L to report partners' capital using the selected capital account accounting method?

Answer

Enter the partners' capital account information in the Analysis of Partners' Capital Accounts section in the Schs M-2 and K-1 column in Screen M1M2 in the Balance Sheet folder. Enter amounts using the capital account accounting method you entered in Screen K1Misc.

Note

The IRS has clarified in the Form 1065 instructions for Schedule M-2 that the amounts on a partnership's Schedule M-2, line 3 should show net income (loss) on the partnership books and records as used in maintaining the partner’s capital accounts for purposes of Schedule K-1. Therefore, UltraTax CS automatically uses amounts entered in the Sch M-2 and K-1 column in Screen M1M2 in the Balance Sheet folder for both Schedules K-1 and M-2.

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