Partnership Vehicle Expenses

Forum|Forum|4 years ago
January 31, 2022
1 reply
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I have a partnership and I am filling out my first 1065.

I use a vehicle that is in my name and not my personal name for business reasons. Do I need to fill out the expenses when filing the 1065 or can I just deal with that on my personal tax return? If so, would I be filling out a schedule C for those expenses? If that is the case, I would be filling out a Schedule K and Schedule C for the same business.

TurboTax Self Employed Online

PatriciaV

Employee

Important questions for your situation:

Are you an active participant in this partnership?
Does the partnership reimburse you for your vehicle expenses? If so, the expenses belong on Form 1065 and not your personal return.
Does the partnership agreement state that you are required to pay for this vehicle yourself?

According to the IRS (instructions for Form 1040, Schedule E) :

Unreimbursed Partnership Expenses

You can deduct unreimbursed ordinary and necessary partnership expenses you paid on behalf of the partnership on Schedule E if you were required to pay these expenses under the partnership agreement. You can only deduct unreimbursed expenses on Schedule E that are trade or business expenses under section 162. Don't report unreimbursed partnership expenses separately if the expenses are from a passive activity and you are required to file Form 8582; otherwise, do the following.

Enter unreimbursed partnership expenses from nonpassive activities on a separate line in column (i) of line 28. Do not combine these expenses with, or net them against, any other amounts from the partnership.
If the expenses are from a passive activity and you are not required to file Form 8582, enter the expenses related to a passive activity on a separate line in column (g) of line 28. Do not combine these expenses with, or net them against, any other amounts from the partnership.
Enter “UPE” in column (a) of the same line.

Note that you will include the information from the partnership Form 1065 Schedule K-1 on your personal Form 1040 Schedule E, not Schedule C.

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nailgafarov

We have same situation, our vehicle was registered under partnership. And each partner drive ~10k miles but we not recognize that will be undeductible by miles in mmllc. Can we deduct this miles in ours smllc tax returns? Because we pay cash at gas stations it will be really hard to calculate actual expenses.

We bought and sell this vehicle in 2021 I see we can include purchase in assets but where I can file selling? Turbo tax Business 2021.

ZoltanB45

There should be a tab that asks whether you stopped using the vehicle in 2021. If you select that, it will generate questions such as the sale price and date it was disposed of.