Brian Davis wrote:

- quote -

I assume you mean the IRA got a K-1.

- quote -

If the partnership throws off enough unrelated business
taxable income, the IRA may have to file an income tax
return. You don't want to go there.

Phoebe

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Brian Davis wrote:

- quote -

YOu are cor.....rect!
(want a job?

Cheer$$,
Harlan Lunsford, EA n lA

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rd[at]brdcpa.us (Brian Davis) wrote:

- quote -

You are correct that the K-1 income doesn't go on the
beneficiaries 1040. Unfortunately the IRA may have to
prepare a return and pay tax on the k-1 income. Partnerships
often generate unrelated business taxable income. See
Sections 408(e)(1) and 511.

This is an excellent reason to avoid partnership investments
in your IRA.

Drew Edmundson, CPA (NC)

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Please help settle this one:

Does an individual who has an IRA-SEP, and the IRA has a
partnership interest and recieves a Form 1065 with interest
income/(loss) or cap gain(loss), have to report this on
their 1040?

I say no since an IRA is a tax deferred instrument and that
the Form 1065 was issued for informational purposes only.
Someone else says report it.

Thanks.
Brian

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