Assignment: Preparation of Form 1065 Page 1, Schedule K and K-1
Jet Stream LLC
FACTS RELATED TO 2014:
- Jet Stream filed for LLC status on October 27, 2013 and started generating revenue mid 2014.
- The $5,000 of organizational expenses were incurred during 2014 and were incident to the creation of the partnership.
- Of the total interest income $1,500 comes from tax exempt bonds and the remainder is taxable.
- The gain from the sale of fixed assets qualifies as IRC Section 1231 gain.
- The total dividends are from domestic companies. Jet Stream has held the stock since November 2013.
- Seth is a 30% service partner acting as Jet's Stream's Director of Marketing. He receives $95,000 for the services he provides to Jet Stream.
- Seth's taxable year end is December 31st.
- Gwen, the President of Jet Stream owns the remaining 70%. Gwen's taxable year end is December 31st.
- Jet Stream does not have a compelling business purpose for a fiscal year end.
REQUIREMENTS:
- A blank form 1065 page one, Schedule K and Schedule K-1 are posted in this module under the assignment section.
- Complete these by hand OR you may use the IRS editable forms if you know how.
- You MUST submit Form 1065, Schedule K and Schedule K-1 in PDF format.
- You MAY submit supporting calculations using PDF format. If you preform your calculations in excel make sure to show them before converting your document to PDF because once converted I will not be able to review formulas. Be sure to format these before submitting to me. This means I should be able to view each page independently.
1.) Complete page one of Form 1065 as follows:
- Name of Partnership
- Lines 1 - 22 if applicable.
- If you group items on one line just indicate this by writing in the expense titles and amounts grouped
- Do NOT complete page two, three or five of Form 1065.
2.) Complete Schedule K
- All applicable lines
- Ignore line 14a.
3.) Complete Schedule K-1 for Seth ONLY
- Box B, F and J
- Lines 1 - 20 if applicable. Indicate the description of the item in box 18 if applicable.
- Ignore line 14
4.) Indicate what Jet Stream's required tax year must be and why.
5.) Indicate whether the organization expenses are currently deductible and why or why not. Cite the applicable Code Section and rules if applicable.
Attachment:- Attachments.rar