Publication 4505 Modernized e-File Test Package for Forms 1065/1065-B For Tax Year 2006
U.S. Return of Partnership Income U.S. Return of Income for Electing Large Partnerships And Form 7004, Application for Automatic 6-Month Extension of Time to File Certain Business Income Tax, Information, and Other Returns
Internal Revenue Service Electronic Tax Administration
WHO MUST TEST?..............................................................................................3 WHY TEST? .........................................................................................................3 WHAT IS TESTED? .............................................................................................3 FORMATTING THE ENTITIES.............................................................................4 POPULATING DATA IN THE TEST CASES .......................................................4 PASSWORDS ......................................................................................................5 WHEN TO TEST...................................................................................................5 TESTING GUIDELINES FOR SOFTWARE DEVELOPERS ................................5 FEDERAL/STATE TESTING FOR FORMS 1065/1065-B....................................5 ELECTRONIC SIGNATURES ..............................................................................5 REVIEWING ACK FILES AND CORRECTING TESTS .......................................6 FINAL TRANSMISSION.......................................................................................7 COMMUNICATIONS TEST FOR THE e-file SYSTEM ........................................7 USING YOUR OWN TEST ...................................................................................7 EXHIBITS .............................................................................................................8 EXHIBIT 1 POSTAL SERVICE STATE ABBREVIATIONS AND ZIP CODES ....9 EXHIBIT 2 FOREIGN COUNTRY CODES .........................................................11 EXHIBIT 3 VALID EINS AND NAME CONTROLS ............................................15 EXHIBIT 4 TAX YEAR 2006 1065/1065-B TEST SCENARIOS.........................16 EXHIBIT 5 TAX YEAR 2006 7004 TEST SCENARIOS .....................................19 TAX YEAR 2006 1065/1065-B TEST SCENARIO DATA ..................................21 TAX YEAR 2006 7004 TEST SCENARIO DATA .............................................154
1065/1065-B ASSURANCE TESTING TAX YEAR 2006
(INCLUDING 7004) WHO MUST TEST? All software developers are required to perform the tests in this Test Package before they can be accepted into the electronic filing program for the 2007 (Tax Year 2006) filing season. Anyone who plans to transmit must perform a communications test and be accepted. Prior to testing, all software developers and transmitters must have obtained an Electronic Transmitter Identification Number (ETIN), Electronic Filer Identification Number (EFIN) and password through the application process. Refer to Publication 3112, IRS e-file Application Package for Form 8633 procedures. For the On-Line application procedures refer to the http://www.irs.gov/taxpros/article/0,,id=109646,00.html URL. This ETIN must be included in each message. The ETIN will be set to “Test” until the transmitter passes the required communication testing with the IRS at which time the ETIN will be moved to “Production” status. The transmitter may also request a Test ETIN, which can be used to continue testing once the original ETIN has been moved to Production status. If a transmitter has not revised their IRS e-file application to indicate they will be transmitting 1065 returns, their ETIN will not be valid and their submissions will be rejected. The transmission status (Test or Production) of the ETIN being used must match the Test/Production Indicator in the Message Header or the message will be rejected. The transmitter must also register the system(s) that will be used to conduct business with MeF to obtain a systemID. If a transmitter and system(s) are not registered, the transmitter cannot access MeF for Fed/State processing. WHY TEST? The purpose of testing prior to live processing is to ensure that: 1. Filers transmit in the correct format and meet the Internal Revenue Service (IRS) Modernized e-File (MeF) electronic filing specifications; 2. Returns have few validation or math errors; 3. IRS can receive and process the electronic returns; 4. Filers understand and are familiar with the mechanics of electronic filing.
WHAT IS TESTED? The test package for the 2006 Assurance Testing System (ATS) consists of eight (8) return scenarios for Forms 1065/1065-B and five (5) for Form 7004. The test returns include a limited number of forms and schedules that are accepted for electronic filing. Every conceivable condition cannot be represented in the Test; therefore, once you pass the tests, you may want to test any additional conditions you feel are appropriate as long as you use the predefined EINs and Name Controls, Tax Period and Form types as outlined in Exhibits 4 and 5. The scenarios provide the information needed to prepare the selected forms and
schedules. You must correctly prepare and compute these returns before transmitting the tests. The IRS strongly recommends each return be run against a parser prior to being transmitted to the IRS. The IRS will run each return against a parser. Also included are five (5) test scenarios for the Form 7004, Application for Automatic 6-Month Extension of Time to File Certain Business Income Tax, Information, and Other Returns that need to be completed and submitted for approval. We have included additional EINs to accommodate all other form types listed on the 7004 for which an extension can be filed for. You may use these EINs for testing if you want to test the other form types. Below are some XML resources regarding XML schemas and software tools and parsers (these resources are provided for information only—the IRS is not endorsing any product). You may chose any third party parser toolkit or use your own. • W3C XML Home Page: http://www.w3.org/XML/ • W3C XML Schema Home Page: http://www.w3.org/XML/Schema • XML Spy: http://www.xmlspy.com/ • Apache Xerces parser toolkit: http://xml.apache.org/ • Microsoft Core XML Services: Microsoft Core XML Services: http://www.microsoft.com/downloads/details.aspx?FamilyID=3144b72bb4f2-46da-b4b6-c5d7485f2b42&DisplayLang=en
FORMATTING THE ENTITIES The business entities presented in the test scenarios are shown in common usage with commas and periods. Refer to XML efile Types for proper formatting for the business name lines and addresses. No commas or periods are allowed. Example: Test Scenario Help For All, Inc. 31 Any Street Anytown, MD 20901 XML Format Help For All Inc (BusinessNameLine1Type) 31 Any St (StreetAddressType) Anytown (CityType) MD (StateType) 20901 (ZipCodeType)
POPULATING DATA IN THE TEST CASES
We are not providing the forms in the tests in PDF format. Fields where we are indicating no entry are shaded. Do not enter zeroes in the fields where you have no entries unless the form or instructions specifically instruct you to do so. PASSWORDS New or revised applicants who will be transmitting to the IRS will receive an eight-digit alphanumeric password that will be used for testing and production. This password will be mailed to the applicants with instructions on how to acknowledge receipt in order to activate. You will change your password then you log in for the first time after your password has been received. It will be valid at the beginning of ATS, which will begin October 30, 2006. If testing will be done through the Internet, applicants will choose their passwords during On-Line Registration. WHEN TO TEST When you are ready to test call the e-Help Desk at 1-866-255-0654. They will assist you in all preparations necessary to begin testing that includes assigning you a Software ID to use when submitting your returns. TESTING GUIDELINES FOR SOFTWARE DEVELOPERS Software does not have to provide for all forms or schedules, nor for all occurrences of a particular form or schedule. You must advise the e-Help Desk at 1-866-255-0654 of all limitations to your Software package at the time of first contact, before testing begins. You must test the complete form with no field limitations except for the number of occurrences. FEDERAL/STATE TESTING FOR FORMS 1065/1065-B For Tax year 2006, we will not implement States ATS; however, the full ATS for both transmitters and states will be available on October 30, 2006. Any of the test returns may be used if you will be participating in the Federal/State electronic filing program for 1065/1065-B. Inform the e-Help Desk of which test you will be using. You should add the appropriate information in the generic state record and transmit the return as part of your regular transmission. Specific instructions are available from the participating states. Fed/State returns may be transmitted through Application to Application or Internet Filing Application (IFA). ELECTRONIC SIGNATURES Tax Professionals who file 1065/1065-B have two options of filing a totally paperless return for their clients using the Practitioner PIN method or the Scanned Form 8453 method (Form 8453-PE for Form 1065 and Form 8453-B for Form 1065-B). The selected signature option must be identified in the Return Header. Tax Professionals who file 7004 have one option of filing using the Practitioner PIN method. MeF validates that a signature is present for each return. If the taxpayer uses a PIN to sign the return, all appropriate PIN information must be present in the return header. If the taxpayer elects to sign a Form 8453x, the scanned 8453x must be attached to the return. If the electronic return does not contain the required signatures, it will be rejected.
• Practitioner PIN The Practitioner PIN option can only be used if the taxpayer uses an ERO. It cannot be used if a taxpayer is filing through an On-Line Provider. If the signature option of “PIN Number” is chosen, the taxpayer and ERO will be required to sign the return with a personal identification number (PIN). The Practitioner PIN option consists of two PINs – one for the taxpayer and one for the Practitioner. 1. Taxpayer PIN – The taxpayer chooses the PIN that they wish to use to sign their return. The Taxpayer’s PIN must be 5 numeric characters and cannot contain all zeros. 2. Practitioner PIN – The ERO selects an eleven position PIN to sign the return. The first 6 positions of the Practitioner PIN will be made up of the EFIN of the ERO and the next 5 positions will be made up of 5 numeric characters that the ERO will select. The taxpayer must decide whether they want to enter their own PIN or whether they authorize the ERO to enter the PIN they choose as their signature. This authorization is made on Form 8879-PE or 8879-B. The following fields are required for the Practitioner PIN method or the return will be rejected. • Practitioner PIN • PIN Entered By Indicator • Name of Officer • Title of Officer • Taxpayer PIN • Date Signed
• Scanned Form 8453
The scanned Form 8453 method must be used if the taxpayer decides not to use the Practitioner PIN method for signing the return. The Form 8453PE or 8453-B will be completed and signed by all required parties and then scanned as a PDF file. The appropriate signature option of “Binary Attachment 8453 Signature Document” must be identified in the Return Header. If this option is chosen, the taxpayer and ERO (if applicable) must sign the paper 8453. The signed Form 8453-PE/8453-B must then be scanned into a PDF document and inserted into the electronic return as a binary attachment. The binary attachment must be named “8453 Signature Document”.
REVIEWING ACK FILES AND CORRECTING TESTS You may transmit as many test returns as necessary until you receive no error messages. Any Business Rules violations must be corrected in order to pass
ATS testing. FINAL TRANSMISSION Once you receive no rejects, you will be required to transmit the returns in two separate, same-day transmissions in order to test the ability of your software to increment the transmission ID number that appears in the Transmission Header. Tests 1-4 should be in the first transmission and Tests 5-8 in the second transmission. If you have included the 7004 test scenarios in your testing, include these tests in the second transmission. COMMUNICATIONS TEST FOR THE e-file SYSTEM IRS allows three means of transmission for MeF, Electronic Management system (EMS), Internet Filing Application (IFA), and Application to Application (A2A). If you are a Transmitter and will be transmitting using the Electronic Management System (EMS), you must pass the communications test with software using the asynchronous (ASC) protocol. The EMS site for communications testing is the Tennessee Computing Center (TCC). If you are a Transmitter using accepted software, you must complete an error-free communications test by transmitting five returns in two same-day transmissions (three returns in one transmission and two in the other) to TCC. Transmitters who have passed the communications test and want to continue to test, must request a test ETIN. If you will be transmitting through the Internet, you will need to perform the communications test through the Internet. If you will be transmitting through A2A, you will need to perform the communications test through A2A. If you will be transmitting through all portals, EMS, Internet and A2A, communications tests must be performed through all systems. A Software Developer, who will not transmit, need not perform a communications test. USING YOUR OWN TEST If you are a Software Developer, when you have been notified that you have passed the ATS test, you may test with your own data using the same password and ETIN. If you are a Transmitter you will need to get a new Test ETIN to continue testing, as your original ETIN will have been moved to “production” status once you have passed the Communications Test. You will continue to use the same password. Call the e-Help Desk at 1-866-255-0654 using the Andover Service Center prompt to obtain a new Test ETIN. You must use the same taxpayer entity information (names and EINs) that is provided in the test package for your independent tests. DO NOT use any other EINs. See Exhibit 3 for the list of valid EINs and Name Controls.
EXHIBITS The following exhibits are provided at the end of this document: Exhibit 1 - Standard Postal Service State Abbreviations and Zip Codes Exhibit 2 – Foreign Country Codes Exhibit 3 – List of valid EINs and Name Controls Exhibit 4 – Tax Year 2006 1065/1065-B Test Scenarios Exhibit 5 – Entities for 7004 Test Scenarios
EXHIBIT 1 VALID ZIP CODES
STANDARD POSTAL SERVICE STATE ABBREVIATIONS AND ZIP CODES
State
Alabama
Abbr.
AL
ZIP Code
350nn-369nn
Alaska
Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma
AK
AZ AR CA CO CT DE DC FL GA HI ID IL IN IA KS KY LA ME MD MA MI MN MS MO MT NE NV NH NJ NM NY NC ND OH OK
995nn-999nn
850nn-865nn 716nn-729nn, 75502 900nn-908nn, 910nn-961nn 800nn-816nn 060nn-069nn 197nn-199nn 200nn-205nn 320nn-339nn, 341nn, 342nn, 344nn, 346nn, 347nn, 349nn 300nn-319nn, 39815, 39834, 399nn 967nn, 968nn 832nn-838nn 600nn-629nn 460nn-479nn 500nn-528nn 660nn-679nn 400nn-427nn, 45275 700nn-714nn, 71749 03801, 039nn-049nn 20331, 206nn-219nn 010nn-027nn, 055nn 480nn-499nn 550nn-567nn 386nn-397nn 630nn-658nn 590nn-599nn 680nn-693nn 889nn-898nn 030nn-038nn 070nn-089nn 870nn-884nn 004nn, 005nn, 06390, 100nn-149nn 270nn-289nn 580nn-588nn 430nn-459nn 730nn-732nn, 734nn-749nn
EXHIBIT1 - Valid ZIP Codes Continued
State Abbr. ZIP Code
Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming OR PA RI SC SD TN TX UT VT VA WA WV WI WY 970nn-979nn 150nn-196nn 028nn, 029nn 290nn-299nn 570nn-577nn 370nn-385nn 733nn, 73949, 750nn-799nn 840nn-847nn 050nn-054nn, 056nn-059nn 20041,201nn, 20301,20370, 220nn-246nn 980nn-986nn, 988nn-994nn 247nn-268nn 49936, 530nn-549nn 820nn-831nn FOR
STANDARD POSTAL SERVICE STATE ABBREVIATIONS AND ZIP CODES U.S.POSSESSIONS
U.S. Possession
American Samoa
Abbr.
AS
ZIP Code
967nn
Federated States of Micronesia Guam
Marshall Islands Commonwealth of the Northern Mariana Islands Palau Puerto Rico U.S. Virgin Islands
FM GU
MH MP PW PR VI
969nn 9691n, 9692n
969nn 9695n 969nn 006nn, 007nn, 009nn 008nn
Form 1065 and 1065-B returns with addresses in the American Possessions are considered to have domestic addresses for processing purposes. The partnership return filer address (1065/1065-B) must contain a state abbreviation to be treated as (and processed in Philadelphia) an American Possession. APO/FPO CITY/STATE/ZIP CODES FOR MILITARY OVERSEAS ADDRESSES City APO or FPO APO or FPO State AA AE ZIP Code 340nn 090nn-098nn
APO or FPO
AP
962nn-966nn
EXHIBIT 2 FOREIGN COUNTRY CODES
Code AF AL AG AQ AN AO AV AY AC AR AM AA AT AS AU AJ BF BA FQ BG BB BS BO BE BH BN BD BT BL BK BC BV BR IO VI BX
Foreign Country Afghanistan Albania Algeria American Samoa Andorra Angola Anguilla Antarctica Antigua & Barbuda Argentina Armenia Aruba Ashmore & Cartier Islands Australia Austria Azerbaijan Bahamas Bahrain Baker Islands Bangladesh Barbados Bassas da India Belarus Belgium Belize Benin Bermuda Bhutan Bolivia Bosnia-Herzegovina Botswana Bouvet Island Brazil British Indian Ocean Territory British Virgin Islands Brunei
Code BM BY CB CM CA CV CJ CT CD CI CH KT IP CK CO CN CF CG CW CR VP CS IV HR CU CY EZ DA DJ DO DR TT EC EG ES EK
Foreign Country Burma Burundi Cambodia Cameroon Canada Cape Verde Cayman Islands Central African Republic Chad Chile China Christmas Island Clipperton Island Cocos (Keeling) Islands Colombia Comoros Congo, Republic of the (Brazzaville) Congo, Democratic Rep of the (Zaire) Cook Islands Coral Sea Islands Corsica Costa Rica Cote D’Ivoire (Ivory Coast) Croatia Cuba Cyprus Czech Republic
Denmark
Djibouti Dominica Dominican Republic East Timor Ecuador Egypt El Salvador Equatorial Guinea
BU UV ET EU FK FO FM FJ FI FR FG FP FS GB GA GZ GG GM GH GI GO GR GL GJ GP GQ GT GK GV PU GY HA HM HO HK HQ HU IC IN
Bulgaria Burkina Faso Ethiopia Europe Island Territory Falkland Islands (Islas Malvinas) Faroe Islands Federated States of Micronesia Fiji Finland France French Guinea French Polynesia French Southern & Antartic Lands Gabon The Gambia Gaza Strip Georgia Germany Ghana Gibraltar Glorioso Islands Greece Greenland Grenada Guadeloupe Guam Guatemala Guernsey Guinea Guinea-Bissau Guyana Haiti Heard Island & McDonald Islands Honduras Hong Kong Howland Island Hungary Iceland India
ER EN IR IZ EI IS IT JM JN JA DQ JE JQ JO JU KZ KE KQ KR KN KS KU KG LA LG LE LT LI LY LS LH LU MC MK MA MI MY MV ML
Eritrea Estonia Iran Iraq Ireland Israel Italy Jamaica JanMayen Japan Jarvis Island Jersey Johnston Atoll Jordan Juan de Nova Island Kazakhstan Kenya Kingman Reef Kiribati Korea, Democratic People’s Republic of (North) Korea, Republic of (South) Kuwait Kyrgyzstan Laos Latvia Lebanon Lesotho Liberia Libya Liechtenstein Lithuania Luxembourg Macau Macedonia Madagascar Malawi Malaysia Maldives Mali
ID IM RM MB MR MP MF MX MQ MD MN MG MH MO MZ WA NR BQ NP NL NT NC NZ NU NG NI NE NF CQ NO MU OC PK LQ PS PM VC SU NS SV
Indonesia Man, Isle of Marshall Islands Martinique Mauritania Mauritius Mayotte Mexico Midway Islands Moldova Monaco Mongolia Montserrat Morocco Mozambique Namibia Nauru Navassa Island Nepal Netherlands Netherlands Antilles New Caledonia New Zealand Nicaragua Niger Nigeria Niue Norfolk Island Northern Mariana Island Norway Oman Other Countries Pakistan Palmyra Palau Panama St. Vincent and the Grenadines Sudan Suriname Svalbard
MT PP PF PA PE RP PC PL PO RQ QA RE RO RS RW WS SM TP SA SG SE SL SN LO SI BP SO SF SX SP PG CE SH SC ST SB TV UG UP TC
Malta Papua-New Guinea Paracel Islands Paraguay Peru Philippines Pitcairn Islands Poland Portugal Puerto Rico Qatar Reunion Romania Russia Rwanda Samoa (Western) San Marino Sao Tome and Principe Saudi Arabia Senegal Seychelles Sierra Leone Singapore Slovakia Slovenia Solomon Islands Somalia South Africa South Georgia & The South Sandwich Islands Spain Spratly Islands Sri Lanka St. Helena St. Kitts & Nevis St. Lucia Island St. Pierre & Miquelon Tuvalu Uganda Ukraine United Arab Emirates
WZ
Swaziland
UK
SW SZ SY TW TI TZ TH TO TL TN TD TE TS TU TX TK
Sweden Switzerland Syria Taiwan Tajikistin Tanzania Thailand Togo Tokelau Tonga Trinidad & Tobago Tromelin Island Tunisia Turkey Turkmenistan Turks and Caicos Islands
UC UY UZ NH VT VE VM VQ WQ WF WE WI YM YO ZA ZI
United Kingdom (England, Northern Ireland, Scotland, and Wales) Unknown Country Uruguay Uzbekistan Vanuatu Vatican City Venezuela Vietnam Virgin Islands (US) Wake Island Wallis & Futuna West Bank Western Sahara Yemen (Aden) Yugoslavia Zambia Zimbabwe
EXHIBIT 3
VALID EINS AND NAME CONTROLS
For 1065
66-0000001 66-0000002 66-0000003 66-0000004 66-0000005
Name Control
SAMS JENN CARL EAST SHOE
Tax Period Ending Month
12 12 12 12 12
For 1065-B
66-0000006 66-0000007 66-0000008
Name Control
ABCO ABCC BLAC
Tax Period Ending Month
12 12 12
For 7004
11-0000030 11-0000031 11-0000032 11-0000033 11-0000034 11-0000035 11-0000036 11-0000037 11-0000038 11-0000039 11-0000040 11-0000041 11-0000042 11-0000043 11-0000044 11-0000045 11-0000046 11-0000047 11-0000049 11-0000050 11-0000051 11-0000052 11-0000053 11-0000054 11-0000055 11-0000056 11-0000057
Name Control
RAMC MODE FRUI FORE UNIT ANYB HOME ANYL NUCL VOTE ANYR ANYS SECO HOTT APPL ANYF ANYC ANYR FLOW REDE LAMP PUTT CAMP SEAT LOOP BLUE ROSE
Tax Period Ending Month
10 10 12 7 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 12 3 12 12 12
Type of Extension
1120S 1120 1120 (subchpt T) 1120-FSC 1120-A 1120 1120-H 1120-L 1120-ND 1120-POL 1120-REIT 1120-SF 1120-F 1120 affiliate 1120 affiliate 990-C 1120-PC 1120-RIC 1065 1120-C 706-GS(D) 706-GS(T) 1041 1042 1066 3520-A 8804
Exhibit 4 Tax Year 2006 1065/1065-B Test Scenarios TAX YEAR 2006 1065/1065-B TEST SCENARIOS
1. 1065, 4562 (2), 4797, 8825, 8882, 1065 SCH K-1 (102), Form 8453-PE,
Dependencies ATTACHMENTS: Itemized Other Deductions Statement Other Credits and Credit Recapture Statement Schedule L Other Assets Statement Schedule L Other Current Liabilities Statement Ordinary Business Income (Loss) Statement Code U Other Credit Statement BINARY ATTACHMENTS: Scanned Form 8453-PE (8453 Signature Document) NOTE: Please use the same data for the additional ninety-nine (99) Schedule K-1s, but increment the entity information as follows: EIN: 001-06-1001 Name: Taxpayer A1 Address: PO Box 0001 EIN: 001-06-1002 Name: Taxpayer A2 Address: PO Box 0002 EIN: 001-06-1003 Name: Taxpayer A3 Address: PO Box 0003
2. 1065, 4562, 4797, 8271, 8824, 1065 SCH K-1 (2), Form 8453-PE, Dependencies
ATTACHMENTS: Self-Charged Interest Election Section 195 Election Itemized Other Deductions Statement BINARY ATTACHMENTS: Scanned Form 8453-PE
3. 1065, Schedule M-3 (Form 1065) 4562, 8865, 1065 SCH K-1 (3), 8865, 8865 SCH
O, 8865 SCH P, Dependencies ATTACHMENTS: Ordinary Income (Loss) From Other Partnerships, Estates, and Trusts Statement Other Income (Loss) Statement (Form 1065, Line7, Other Income (Loss); Form 1065 Instructions, other Income (Loss) Pg 15)
Publicly Traded Partnership Statement Ownership of Any Interest in Another Partnership or Foreign Entity Statement Section 754 Election Income (Loss) From Foreign Partnerships Schedule BINARY ATTACHMENTS: None
4. 1065, 4562, 4797, 8308, 1065 Sch D, 1065 Sch K-1 (3), Form 8453-PE,
Dependencies ATTACHMENTS: Other Income (Loss) Statement Itemized Other Deductions Statement Itemized Section 263A Costs Schedule Inventoriable Costs Paid Schedule Section 754 Election Partnership’s Charitable Contributions Statement Other AMT Items Statement Schedule L Other Current Assets Statement Schedule L Other Assets Statement Schedule L Other Current Liabilities Statement BINARY ATTACHMENTS: Scanned Form 8453-PE (8453 Signature Document)
5. 1065, 4562 (2), 4797, 6252, 8825, 1065 SCH K-1 (4), Form 8453-PE, Dependencies
ATTACHMENTS: Ordinary Income (Loss) From Other Partnerships, Estates, and Trusts Statement Other Income (Loss) Statement (Form 1065, Line7, Other Income (Loss); Form 1065 Instructions, Other Income (Loss) Pg 15) Itemized Other Deductions Statement Ownership of Any Interest in Another Partnership or Foreign Entity Statement Schedule L Other Current Assets Statement Schedule L Other Current Liabilities Statement BINARY ATTACHMENTS: Scanned Form 8453-PE (8453 Signature Document)
6. 1065-B, 4797, 1065-B SCH K-1 (2), Form 8453-B, Dependencies
ATTACHMENTS: Itemized Other Deductions Schedule Inventoriable Costs Paid Schedule Balance Sheets Discrepancy Statement Schedule L Other Current Assets Statement
BINARY ATTACHMENTS: Scanned Form 8453-B (8453 Signature Document)
7. 1065-B, 4562, 8825, 1065-B SCH K-1 (2), Form 8453-B, Dependencies
ATTACHMENTS: Itemized Other Deductions Schedule Schedule K-1(Form 1065-B) Miscellaneous Item Statement Qualified Nonrecourse Financing Statement BINARY ATTACHMENTS: Scanned Form 8453-B (8453 Signature Document)
8. 1065-B, 8308, 1065-B SCH K-1 (101)
ATTACHMENTS: Itemized Other Deductions Schedule BINARY ATTACHMENTS: None NOTE: Please use the same data for the additional ninety-eight (98) Schedule K-1s, but increment the entity information as follows: EIN: 001-06-2001 Name: Taxpayer B1 Address: PO Box 0001 EIN: 001-06-2002 Name: Taxpayer B2 Address: PO Box 0002 EIN: 001-06-2003 Name: Taxpayer B3 Address: PO Box 0003
EXHIBIT 5 TAX YEAR 2006 7004 TEST SCENARIOS
1. Form: 1120S RAM Corporation, Inc. 101 Main Street Downtown, MD 20601 Name Control: RAMC 11-0000030
2.
Form 1120 Modern Technologies, Inc . 11-0000031 301 New Street Newtown, ND 58204 Name Control: MODE Affiliate 1: Hottest Communications 11-0000043 100 Mall Avenue Uptown, OH 45324 Name Control: HOTT Affiliate 2: High-Tech Solutions PENDING 200 Main Street Anytown, NC 27905 Name Control: HIGH
3.
Form 1120-FSC Foreign Business One 2 Rue Street Paris City. France Name Control: FORE Write-In: FILING UNDER REGULATION SECTION 1.6081-5 Affiliate 1: Overseas Imports NONE 123 Wide Street New City, NY 00422 11-0000033
EXHIBIT 5 TAX YEAR 2006 7004 TEST SCENARIOS
(Continued)
4.
Form 1065 Flower Store One 3 Bulb Street Somewhere, TX 78621 Name Control: FLOW 11-0000049
5.
Form 1120C RedesignComp, Inc 55 Any Street Anytown, MI 49261 Name Control: REDE 11-0000050
Sam Starling LLP
TEST SCENARIO 1
66-0000001
FORMS REQUIRED: 1065, 4562 (2), 4797, 8825, 8882, 1065 SCH K-1 (102), Form 8453-PE DEPENDENCIES ATTACHMENTS:
Itemized Other Deductions Statement Other Credits and Credit Recapture Statement Schedule L Other Assets Statement Schedule L Other Current Liabilities Statement
Ordinary Business Income (Loss) Activity Statement BINARY ATTACHMENTS: Scanned Form 8453-PE (8453 Signature Document) HEADER INFO: Tax Period: Calendar Year 2006 Preparer Firm Electronic Tax Filers, Inc 1065 Efile Drive Anytown, NV 89501 66-0000001
MultipleSoftwarePackagesUsed: Yes or No Originator: EFIN: Self-select Type: ERO PractionerPIN: None PIN Entered by – N/A Signature Option: Binary Attachment 8453 Signature Document Return Type: 1065 Filer: EIN: 66-0000001 Name: Sam Starling LLP Name Control: SAMS Address: 631 N McKinley Dr Reno, NV 89510 Name: Sam Starling Title: President Taxpayer PIN: Phone: 555-555-5555 Email Address: Anymail@email.com Date Signed: 04/01/2006 Name: Jesse James SSN: 001-06-0001 Phone: 555-555-5555 Email Address: Anymail@email.com Date Prepared: 04/01/2006 Self Employed: No N/A
Partner:
Preparer:
IRS PAYMENT:
Sam Starling LLP
Details for attachments to Form Attachment 1, Form 1065, Page 1, Line 20 (Itemized Other Deductions Statement) Travel and Entertainment Other Utilities Fees 5,600,000 28,750,000 10,000,000 6,387,848
66-0000001
Attachment 2, Form 1065, Page 3, Schedule K, Line 15f (Other Credits and Credit Recapture Statement) Childcare Empowerment 35,600 40,000
Attachment 3, Form 1065, Page 4, Schedule L, Line 13b and 13 d (Schedule L Other Assets Statement) Type Client Receivable Other BOY Amount 7,148,515 6,030,400 EOY Amount 10,916,115 4,227,867
Attachment 4, Form 1065, Page 4, Schedule L, Line 17b and 17d (Schedule L Other Current Liabilities Statement) Type Other Current Liabilities Other Accrued Liabilities BOY Amount 2,315,178 3,162,974 EOY Amount 4,138,515 2,045,400
Attachment 5, Schedule K-1 (Form 1065), Part III, Line 1 (Ordinary Business Income (Loss) Activity Statement) Sam Starling’s Statement ONLY Education Flight Instructor Legal Services
20,000 20,000 72,573,263
Sam Starling LLP
66-0000001
Form 1065 Test U.S. Return of Partnership Income Tax 2006 Calendar Year 2006 or tax year beginning 1/1 , 2006, ending 12/31 , 2006 Principal business activity A Legal Services Principal product or service B Legal Services Business code number C 541110 Name and Address: Sam Starling LLP 631 N McKinley Dr Reno, NV 89510 Employer Identification number D 66-0000001 Date business started E 10/01/1977 Total assets F 108,367,069 Check applicable boxes 1,2,3,4,5 G Check accounting method 1,2,3 H 1 Number of Schedule K-1 I 102 Check if Schedule M-3 Required (attach J Schedule M-3) Line Description Line Amount Write-in / Literal / Attachment Gross receipts or sales 1a 323,455,613 Less returns and allowances 1b Balance 1c 323,455,613 Cost of goods sold (Sch A, line 8) 2 Gross profit. Subtract line 2 from 1c 3 Ordinary income or (loss) 4 Net farm profit (loss) F1040 5 Net gain (loss) F4797 6 10,000 Other income or (loss) 7 Total income. Add lines 3 through 10 8 323,465,613 Salaries and wages (less employment 9 credits) 110,535,025 Guaranteed payments to partners 10 22,675,031 Repairs and maintenance 11 2,042,164 Bad debts 12 Rent 13 25,922,173 Taxes and licenses 14 12,226,452 Interest 15 14,622 Depreciation (attach Form 4562) 16a 7,292,891 Less depreciation claimed on Sch A 16b 18,275 Total depreciation 16c 7,274,616 Depletion 17 Retirement plans, etc 18 4,255,918 Employee benefit programs 19 7,100,361 Other deductions 20 50,737,848 Attachment 1 Total deductions (add lines 9 – 20) 21 242,784,210 Ordinary business income (loss) (Subtract 22 Line 21 from Line 8 80,681,403 23 Credit for federal telephone excise tax paid Schedule A Cost of Goods Sold Inventory at beginning of year 1 Purchases less cost of items 2 Cost of labor 3 Additional section 263A costs 4 Other costs 5 Total. Add lines 1 - 5 6 Inventory at the end of year 7 Cost of goods sold. Subtract Line 7 from 8 6
Sam Starling LLP
Form 1065 Test U.S. Return of Partnership Income Tax 9a (i) Cost in regulations 1.471-3 Lower of cost or market 9a (ii) Other 9a (iii) Check if writedown 9b Check if the LIFO was adopted 9c Section 263A rules apply … 9d Change in determining quantities, cost, 9e valuations Schedule B Other Information Domestic general partnership 1a Domestic limited partnership 1b Domestic limited liability company 1c Domestic limited liability partnership 1d X Foreign partnership 1e Other 1f Any partners in this partnership also 2 Y partnerships? Partnership own interest in another 3 N partnership or foreign entity? Partnership file Form 8893? 4 N Partnership total receipts <$250,000 5a N Partnership total assets <$600,000 5b N Filed Schedule K-1 with return? 5c N Partnership have foreign partners? 6 Y Partnership publicly traded partnership? 7 N Partnership filed F8264? 8 N Partnership have an interest in or a 9 N signature, or other authority over financial account in foreign country? Partnership receive distribution from, 10 N granter of, transferor to foreign trust? Distribution of property or transfer of 11 N partnership interest? Number of Forms 8865 attached 12 0 Name of designated TMP Identifying number of TMP Address of designated TMP Schedule K Partners’ Distributive Share Items Ordinary business income (loss) 1 80,681,403 Net rental real estate income (loss) 2 203,125 Other gross rental income (loss) 3a Other rental activities expenses 3b Other net rental income (loss) Subtract 3c Line 3b from 3a Guaranteed payments 4 22,675,031 Interest Income 5 92,650 Ordinary dividends 6a Qualified dividends 6b Royalties 7 Net short-term capital gain (loss) 8 Net long-term capital gain (loss) 9a Collectibles (28%) gain (loss) 9b Unrecaptured section 1250 gain 9c Net section 1231 gain (loss) 10
66-0000001
2006
Sam Starling LLP
Form 1065 Test U.S. Return of Partnership Income Tax Other income (loss) 11 Section 179 deduction 12 Contributions 13a Investment interest expenses 13b Section 59(e)(2) expenditures (type) 13c Section 59(e)(2) expenditures (amount) 13c (2) Other deductions 13d Net earnings (loss) self employment 14a 41,338,573 Gross farming or fishing income 14b Gross nonfarm income 14c 282,117,040 Low-income housing credit 42(j)(5) 15a Low-income housing credit (other) 15b Qualified rehabilitation expenditures 15c Other rental real estate credits 15d Other rental credits 15e Other credits and credit recapture 15f 75,600 Name of country or U.S. possession 16a Gross income from all sources 16b Gross income sourced at 16c partnership level Passive 16d Listed categories 16e General limitation 16f Interest expense 16g Other 16h Passive 16i Listed categories 16j General limitation 16k Total foreign taxes Paid □ Accrued □ 16l Reduction in taxes available for credit 16m Other foreign tax information 16n Post 1986 depreciation adjustment 17a 199,456 Adjusted gain or loss 17b Depletion (other than oil and gas) 17c Oil, gas, and geothermal properties-gross 17d income Oil, gas, and geothermal properties17e deductions Other AMT items 17f Tax-exempt interest income 18a Other tax-exempt income 18b Nondeductible expenses 18c 775,128 Distri of cash & marketable securities 19a 75,140,310 Distributions of other property 19b Investment income 20a 92,650 Investment expenses 20b Other items and amounts 20c Analysis of Net Income (Loss) Net income (loss) Combine SchK line 1 – 11; Subtract sum SchK line 12 - 13d, and 16l
66-0000001
2006
Attachment 2
1
103,652,209
Sam Starling LLP
(i) Corporate 2a (ii) Individual (active) (iii) Individual (passive) (iv) Partnership652 41,460,884 (v) Exempt organization
66-0000001
(vi) Nominee Other
Analysis by General partners Analysis 2b 62,191,325 by Limited partners Schedule L Balance Sheets per Books Beginning of tax year 1 2a 2b 3 4 5 6 7 8 9a 9b 10a 10b 11 12a 12b 13 14 15 16 17 18 19 20 21 22 Assets Cash Trade notes Less allowance Inventories U.S. govt oblig Tax-exempt securities Other current assets Mortgage & real estate loan Other investments Bldgs & other deprec assets Less accumulated deprec Depletable assts Less accumulated depletion Land Intangible assets Less accum amortization Other assets Total assets Liabilities Accounts payable Mortgages, notes, bonds payable < 1yr Other current liabilities All nonrecourse loans Mortgages, notes, bonds payable > 1yr Other liabilities Partners’ capital accounts Total labilities (a) (b) 15,374,582
End of tax year (c) (d) 41,036,739
Write-in / Literal
64,937,028 32,123,456 32,813,572
79,134,516 26,947,318 52,187,198
(a)
13,178,915 61,367,069 (b)
(c)
15,143,982 108,367,919 (d)
Attachment 3
5,478,152 11,000,000
6,183,915 11,000,000
Attachment 4
44,888,917 61,367,069
91,184,004 108,367,919
Sam Starling LLP
66-0000001
and capital Schedule M-1 Reconciliation of Income (Loss) per Books With Income per Return Line Description Line Amount Write-in / Literal Net Income (loss) per books 1 121,435,397 Income included on SchK lines 1, 2, 3c, 5, 2 6a, 7, 8, 9a, 10, 11, not recorded on the books this year (itemized): Total Income Included 2 Guaranteed payments (other than health 3 insurance) 22,675,031 Expenses recorded on books (itemize) 4a Depreciation Travel & entertainment 4b 5,600,000 Add lines 1 – 4 5 149,710,428 Income recorded on books (itemize) tax6a exempt interest Deductions included on Sch K 7 Deductions not charged against book 7a (itemize) depreciation 46,058,219 Add lines 6 and 7 8 46,058,219 Income (loss) (Analysis of net income 9 (loss) line 1). Subtract line 8 from line 5 103,652,209 Schedule M-2 Analysis of Partners’ Capital Accounts Balance at beginning of year 1 44,888,917 Capital contributed – Cash 2a Capital contributed – Property 2b Net income (loss) per books 3 121,435,397 Other increases (itemized) 4 Add lines 1 through 4 5 166,324,314 Distributions – Cash 6a 75,140,310 Distributions – Property 6b Other decreases (itemized) 7 Add lines 6 and 7 8 75,140,310 Balance at end of year. Subtract line 8 9 from line 5 91,184,004
Sam Starling LLP
66-0000001
Form 4562 Depreciation and Amortization 2006 Name: Sam Starling Business or Activity: Legal Services EIN: 66-0000001 Line Description Line Amount Write-in / Literal / Attachments Part I Election to Expense Certain Property Under Section 179 Maximum amount 105,000 1 Total cost of section 179 prop 2 Threshold cost of section 179 prop 420,000 3 Reduction in limitation 4 Dollar limitation for TY 5 Description of Property 6(a) Cost 6(b) Elected cost 6(c) Listed property 7 Total elected cost of sec 179 prop 8 Tentative deduction 9 Carryover of disallowed deduction 10 Business income limitation 11 Section 179 expense deduction 12 Carryover of disallowed deduction 13 Part II Special Depreciation Allowance and Other Depreciation Special depreciation allowed 14 3,258,175 Property subject to sec 168(f)(1) election 15 Other depreciation 16 625,392 Part III MACRS Depreciation - Section A 17 MACRS deductions 2,743,901 Sec 168(i)(4) election 18 Section B – Assets Placed in Service During 2006 Tax Year Using the General Depreciation System (a)Classification (b)Mont (c) Basis (d)Recovery (e) (f)Meth (g)Depr of property h& for deprec period Conventi od c Year on deduct 3-year property 5-year property 1,428,700 5 yrs HY DDB 285,740 7-year property 2,275,000 7 yrs HY DDB 324,870 10-year property 15-year property 20-year property 25-year property S/L Residential rental MM S/L property Nonresidential real 19i MM S/L 1,425,000 39 yrs 36,538 property Section C – Assets Placed in Service During 2006 Tax Year Using the Alternative Depreciation System Class life 20a 12-year S/L 20b 40-year MM S/L 20c Part IV Summary Listed property 21 Total 22 7,274,616 Assets for CY 23 19a 19b 19c 19d 19e 19f 19g 19h
Write-in / Literal / Attachments
Sam Starling LLP
66-0000001
Part V Listed Property Section A – Depreciation and Other Information Evidence? 24a Evidence written? 24b Special depreciation allowance 25 Type of property 26(a) Date in service 26(b) Business investment % 26(c) Cost or other basis 26(d) Basis for depreciation 26(e) Recovery period 26(f) Method/Convention 26(g) Depreciation deduction 26(h) Election Sec 179 cost 26(i) Type of property 27(a) Date in service 27(b) Business investment % 27(c) Cost or other basis 27(d) Basis for depreciation 27(e) Recovery period 27(f) Method/Convention 27(g) Depreciation deduction 27(h) Election Sec 179 cost 27(i) Add column (h), lines 25 - 27 28 Add column (i), line 26 29 Section B – Information on Use of Vehicles Total bus/invest miles driven 30(a) Total commuting miles driven 31(a) Tot other personal miles driven 32(a) Total miles driven 33(a) Vehicle available for personal use? 34 Vehicle used > 5% ? 35 Another vehicle avail for personal use? 36 Section C – Questions for Employers Who Provide Vehicles for Use by Their Employees Maint written policy prohibits commu? 37 Maint written policy prohibits pers use 38 Vehicles treated as personal use? 39 Provide > 5 vehicle? 40 Qualified auto demonstration use? 41 Part VI Amortization (a)Depreciation of (b)Date (c) Amort (d)Code (e)Amort (f)Amort costs amort amount section period or for this begins percent Yr 42 43 44
Write-in / Literal / Attachments
Amort of costs before 2006 TY Total
Sam Starling LLP
66-0000001
Form 4562 Depreciation and Amortization 2006 Name: Sam Starling LLP Business or Activity: Rental EIN: 66-0000001 Line Description Line Amount Write-in / Literal / Attachments Part I Election to Expense Certain Property Under Section 179 Maximum amount 1 105,000 Total cost of section 179 prop 2 Threshold cost of section 179 prop 3 420,000 Reduction in limitation 4 Dollar limitation for TY 5 Description of Property 6(a) Cost 6(b) Elected cost 6(c) Listed property 7 Total elected cost of sec 179 prop 8 Tentative deduction 9 Carryover of disallowed deduction 10 Business income limitation 11 Section 179 expense deduction 12 Carryover of disallowed deduction 13 Part II Special Depreciation Allowance and Other Depreciation Special depreciation allowed 14 Property subject to sec 168(f)(1) electio 15 Other depreciation 16 Part III MACRS Depreciation - Section A 17 MACRS deductions 18,275 Sec 168(i)(4) election 18 Section B – Assets Placed in Service During 2006 Tax Year Using the General Depreciation System (a)Classification of (b)Mont (c) Basis (d)Recove (e)Conventio (f)Meth (g)Depr Write-in / property h& for ry period n od c Literal / Year deprec deduct Attachments 19a 19b 19c 19d 19e 19f 19g 19h 3-year property 5-year property 7-year property 10-year property 15-year property 20-year property 25-year property Residential rental property
(a)Classification of property (b)Month & Year (c) Basis for deprec (d)Recovery
period
MM
S/L S/L
(g)Deprc deduct Write-in / Literal / Attachments
(e)Convention (f)Method
Nonresidential real MM S/L property Section C – Assets Placed in Service During 2006 Tax Year Using the Alternative Depreciation System Class life 20a 12-year S/L 20b 40-year MM S/L 20c 19i
Sam Starling LLP
66-0000001
Form 4562 Depreciation and Amortization 2006 Part IV Summary Listed property 21 Total 22 18,275 Assets for CY 23 Part V Listed Property Section A – Depreciation and Other Information Evidence? 24a Evidence written? 24b Special depreciation allowance 25 26(a) Type of property 26(b) Date in service Business investment % 26(c) 26(d) Cost or other basis Basis for depreciation 26(e) Recovery period 26(f) 26(g) Method/Convention 26(h) Depreciation deduction Election Sec 179 cost 26(i) 27(a) Type of property 27(b) Date in service Business investment % 27(c) 27(d) Cost or other basis Basis for depreciation 27(e) Recovery period 27(f) 27(g) Method/Convention 27(h) Depreciation deduction Election Sec 179 cost 27(i) Add column (h), lines 25 - 27 28 Add column (i), line 26 29 Section B – Information on Use of Vehicles 30(a) Total bus/invest miles driven 31(a) Total commuting miles driven 32(a) Tot other personal miles driven 33(a) Total miles driven Vehicle available for personal use? 34 Vehicle used > 5% ? 35 Another vehicle avail for personal use? 36 Section C – Questions for Employers Who Provide Vehicles for Use by Their Employees Maint written policy prohibits commu? 37 Maint written policy prohibits pers use 38 Vehicles treated as personal use? 39 Provide > 5 vehicle? 40 Qualified auto demonstration use? 41
Part VI Amortization (a)Depreciation of costs (b)Date amort begins (c) Amort amount (d)Code section (e)Amort period or percent (f)Amort for this Yr Write-in / Literal / Attachments
42 43 44
Amort of costs before 2006 TY Total
Sam Starling LLP
66-0000001
Form 4797 Sales of Business Property 2006 Name: Sam Starling LLP EIN: 66-0000001 Line Description Line Amount Write-in / Literal / Attachments Gross receipts fm sales or exchg 1 Part I Sales or Exchanges of Property Used in a Trade or Business Description of property 2(a) Date acquired 2(b) Date sold 2(c) Gross sales price 2(d) Depreciation allowed 2(e) Cost or other basis 2(f) Gain or (loss) 2(g) Gain fm F4684 3 Sec 1231 gain fm F6252 4 Sec 1231 gain fm F8824 5 Gain fm casualty or theft 6 Combine lines 2 to 6 7 Nonrecaptured net sec 1231 loss 8 Subtract line 8 from line 7 9 Part II Ordinary Gains and Losses 10(a) Description of property 10(b) Date acquired Date sold 10(c) 10(d) Gross sales price Depreciation allowed 10(e) Cost or other basis 10(f) 10(g) Gain or loss Loss fm line 7 11 Gain fm line 7 12 Gain fm line 31 13 10,000 Net gain F4684 14 Ordinary gain F6252 15 Ordinary gain F8824 16 Combine lines 10 to16 17 10,000 Part of loss F4684 18a Redetermined gain or (loss) on line 17 18b Part III Gain for Disposition of Property Under Sections 1245, 1250, 1252, 1254 and 1255 19(a) Description of property Furniture and Fixtures 19(b) Date acquired Various Date sold 19(c) 01/19/2006 Gross sales price 20 10,000 Cost or other basis 21 10,000 Depreciation allowed 22 10,000 Adjusted basis 23 Total gain 24 10,000 Depreciation allowed 25a 10,000 Smaller of lines 24 and 25a 25b 10,000 Additional depreciation after 1975 26a Applicable % 26b Subtract line 26a from line 24 26c Additional depreciation after 1969 26d Line Description Line Amount Write-in / Literal / Attachments Smaller of lines 26c and 26c 26e Sec 291 amount 26f
Sam Starling LLP
Form 4797 Sales of Business Property Add lines 26b,26e and 26f 26g Soil, water, land 27a Line 27 multiplied by applicable % 27b Smaller of lines 24 and 27b 27c Intangible drilling 28a Smaller of lines 24 and 28a 28b Applicable % of payment excluded 29a Smaller of lines 24 and 29a 29b Total gain all property 30 10,000 Add property columns A – D 31 10,000 Subtract line 31 from line 30 32 Part IV Recapture Amounts Under Sections 179 and 280F(b)(2) 33(a) Sec 179 expn ded – Sec 179 33(b) Sec 179 expn ded – Sec 280F(b) 34(a) Recomputed deprc – Sec 179 34(b) Recomputed deprc- Sec280F(b) 35(a) Recapture amount – Sec 179 35(b) Recapture amount – Sec 280F(b) Form 8825 Name: Sam Starling LLP EIN: 66-0000001 1A 2A 3A 4A 5A 6A 7A 8A 9A 10A 11A 12A 13A 14A 15A 16A 17 18 19 20a 20b(1) 20b(2) 21 Line Description Kind & location of each property Gross rents Advertising Auto and travel Cleaning and maintenance Commissions Insurance Legal and other professional fees Interest Repairs Taxes Utilities Wages and salaries Depreciation Other Total expense for each property Total gross rents Total expenses Net gain (loss) F4797 Net income (loss) from rental real estate activities Name EIN Net rental real estate income (loss) Line Amount / Information Rental 1,234,900 Rental Real Estate Income and Expenses of a Partnership or an S Corporation
66-0000001
2006
2006
Write-in / Literal / Attachments
18,275 1,013,500 1,031,775 1,234,900 (1,031,775)
Attachment
203,125
Sam Starling LLP
66-0000001
Form 8882
Credit for Employer-Provided Childcare Facilities and Services
2006
Name: Sam Starling LLP EIN: 66-0000001 Line Description Part I Current Year Credit Qualified childcare facility expend 1 Enter 25% of line 1 2 Qualified childcare resource and referral expend 3 Enter 10% of line 3 4 EIN of pass-through entity 5 Form 8882 credits from pass through entities 5 Add lines 2, 4, and 5 6 Current year credit 7 Amount allocated to beneficiaries 8 Estates and Trusts. Subtract line 8 from line 7 9
Line Amount
Write-in / Literal
66-0000001 35,600 35,600 35,600
Sam Starling LLP
66-0000001
Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 □ Amended K-1 □ Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000001 Partnership's name, address, city, state, and Zip B Sam Starling LLP code 631 N McKinley Dr Reno, NV 89510 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D Tax shelter registration number, if any E Check if Form 8271 is attached F Part II Information About the Partner Partner's Identification number G 001-06-1001 Partner's name, address, city, state and ZIP code H Taxpayer A1 PO Box 0001 Reno, NV 89510 □ General partner or LLC member-manager I Limited partner or other □ Limited partner or other LLC member LLC member □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Partner’s share of profit, loss and capital L Beginning% Ending% Profit .5 .5 Loss .5 .5 Capital .5 .5 Partner’s share of liabilities at year end: M Nonrecourse $ $55,000 Qualified nonrecourse financing $ Recourse $ Partner’s capital account analysis: N Beginning capital account $ $224,445 Capital contributed during the year $ $607,177 Current year increase (decrease) $ Withdrawals & distributions $ ($375,702) Ending capital account $ $455,920 □ Tax basis □ GAAP □ Sect 704(b) book □ Other (explain) Sect 704(b) book Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 $403,407 Net rental real estate income (loss) 2 $1,016 Other net rental income (loss) 3 Guaranteed payments 4 Interest income 5 $463 Ordinary dividends 6a 6b Qualified dividends Royalties 7 Net short-term capital gain (loss) 8 Net long-term capital gain (loss) 9a 9b Collectibles (28%) gain (loss)
Sam Starling LLP
9c 10 11 12 13 14 15 16 17 18 19 20 Unrecaptured section 1250 gain Net section 1231 gain (loss) Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions Alternative minimum tax (AMT) items Tax-exempt income & nondeductible expense Distributions Other Information
66-0000001
A $45,350 C $1,410,585 M $200 U $178 A $997 C $3,876 A $375,702 A $463
Sam Starling LLP
66-0000001
Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 □ Amended K-1 □ Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000001 Partnership's name, address, city, state, and Zip B Sam Starling LLP code 631 N McKinley Dr Reno, NV 89510 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D Tax shelter registration number, if any E Check if Form 8271 is attached F Part II Information About the Partner Partner's Identification number G 001-06-0002 Partner's name, address, city, state and ZIP code H Sam Starling PO Box 99 7 Birch Branch St Johns. NFLD Canada AIC5N5 □ General partner or LLC member-manager I Limited partner or other □ Limited partner or other LLC member LLC member □ Domestic partner J □ Foreign partner Foreign partner What type of entity is this partner? K Partner’s share of profit, loss and capital L Beginning% Ending% Profit 10 10 Loss 10 10 Capital 10 10 Partner’s share of liabilities at year end: M Nonrecourse $ $1,100,000 Qualified nonrecourse financing $ Recourse $ Partner’s capital account analysis: N Beginning capital account $ $4,488,892 Capital contributed during the year $ Current year increase (decrease) $ $12,143,540 Withdrawals & distributions $ ($7,514,031) Ending capital account $ $9,118,401 □ Tax basis □ GAAP □ Sect 704(b) book □ Other (explain) Sect 704(b) book Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 $8,068,140 Net rental real estate income (loss) 2 $20,312 Other net rental income (loss) 3 Guaranteed payments 4 Interest income 5 $9,265 Ordinary dividends 6a 6b Qualified dividends Royalties 7 Net short-term capital gain (loss) 8
Sam Starling LLP
9a 9b 9c 10 11 12 13 14 15 16 17 18 19 20 Net long-term capital gain (loss) Collectibles (28%) gain (loss) Unrecaptured section 1250 gain Net section 1231 gain (loss) Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions Alternative minimum tax (AMT) items Tax-exempt income & nondeductible expense Distributions Other Information
66-0000001
A $907,001 C $28,211,704 M $4,000 U $3,560 E $19,946 C $77,513 A $7,514,031 A $9,265
Sam Starling LLP
66-0000001
Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 □ Amended K-1 □ Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000001 Partnership's name, address, city, state, and Zip B Sam Starling LLP code 631 N McKinley Dr Reno, NV 89510 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D Tax shelter registration number, if any E Check if Form 8271 is attached F Part II Information About the Partner Partner's Identification number G 11-0000011 Partner's name, address, city, state and ZIP code H Barton & Jenkins Enterprise RR 510 W Anchorage, AK 99502 □ General partner or LLC member-manager I General partner or LLC □ Limited partner or other LLC member member-manager □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Partner’s share of profit, loss and capital L Beginning% Ending% Profit 40 40 Loss 40 40 Capital 40 40 Partner’s share of liabilities at year end: M Nonrecourse $ $4,400,000 Qualified nonrecourse financing $ Recourse $ Partner’s capital account analysis: N Beginning capital account $ $17,955,568 Capital contributed during the year $ Current year increase (decrease) $ $48,574,160 Withdrawals & distributions $ ($30,056,124) Ending capital account $ $36,473,604 □ Tax basis □ GAAP □ Sect 704(b) book □ Other (explain) Sect 704(b) book Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 $32,272,560 Net rental real estate income (loss) 2 $81,248 Other net rental income (loss) 3 Guaranteed payments 4 $22,675,031 Interest income 5 $37,060 Ordinary dividends 6a 6b Qualified dividends Royalties 7 Net short-term capital gain (loss) 8 Net long-term capital gain (loss) 9a
Sam Starling LLP
9b 9c 10 11 12 13 14 15 16 17 18 19 20 Collectibles (28%) gain (loss) Unrecaptured section 1250 gain Net section 1231 gain (loss) Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions Alternative minimum tax (AMT) items Tax-exempt income & nondeductible expense Distributions Other Information
66-0000001
A $16,535,429 C $112,846,816 M $16,000 U $14,240 A $79,184 C $310,052 A $30,056,124 A $37,060
Jennings Boats LLC
TEST SCENARIO 2 FORMS REQUIRED: 1065, 4562, 4797, 8271, 8824, 1065 SCH K-1 (2), Form 8453-PE DEPENDENCIES ATTACHMENTS: Self Charged Interest Election Section 195 Election Itemized Other Deductions Statement BINARY ATTACHMENTS: Scanned Form 8453-PE HEADER INFO: Tax Period: Calendar Year 2006 Preparer Firm Electronic Tax Filers, Inc 1065 Efile Drive Anytown, NV 89501 66-0000002
66-0000002
MultipleSoftwarePackagesUsed: Yes or No Originator: EFIN: Self-select Type: ERO PractionerPIN: None PIN Entered by – N/A
Signature Option: Binary Attachment 8453 Signature Document Return Type: Form 1065 Filer: EIN: 66-0000002 Name: Jennings Boats LLC Name Control: JENN Address: Rt 1 Box 843 Bar Harbor, ME 04609 Name: Horace Jennings Title: Chief Executive Officer Taxpayer PIN: Phone: 555-555-5555 Email Address: Anymail@email.com Date Signed: 04/15/2006 Name: Janis Jennings SSN: 001-06-0003 Phone: 555-555-5555 Email Address: Anymail@email.com Date Prepared: 04/15/2006 Self Employed: No
Partner:
Preparer:
IRS PAYMENT:
N/A
Jennings Boats LLC
Details for attachments to Form
Attachment 1, Form 1065 (Self Charged Interest Election) Name of Partnership Jennings Boats Address Rt 1 Box 843 Bar Harbor, ME 04609 EIN 66-0000002
66-0000002
Regulation Section 1.4697(g) Declaration Yes
Attachment 2, Form 1065 (Section 195 Election) Description of Trade or Business Boats Sales and Services Number of Months Expenditure Amortized Sixty (60) Description of Start-Up Expenditure Preorganization Costs Date Trade or Business Began 01/01/2006
Attachment 3, Form 1065, Page 1, Line 20 (Itemized Other Deductions Statement) Amortization Professional Fees Insurance 5,000 225,000 84,722
Jennings Boats LLC
66-0000002
Form 1065 Test U.S. Return of Partnership Income Tax 2006 Calendar Year 2006 or tax year beginning 1/1 , 2006, ending 12/31 , 2006 Principal business activity A Boat Sales Principal product or service B Sales and Services Business code number C 441222 Name and Address: Jennings Boats LLC Rt 1 Box 843 Bar Harbor, ME 04609 Employer Identification number D 66-0000002 Date business started E 01/01/2006 Total assets F $2,749,483 Check applicable boxes 1,2,3,4,5 G 1 Check accounting method 1,2,3 H 2 Number of Schedule K-1 I 2 Check if Schedule M-3 Required (attach J Schedule M-3) Line Description Line Amount Write-in / Literal / Attachment Gross receipts or sales 1a $4,212,980 Less returns and allowances 1b $350,000 Balance 1c $3,862,980 Cost of goods sold (Sch A, line 8) 2 $3,508,023 Gross profit. Subtract line 2 from 1c 3 $354,957 Ordinary income or (loss) 4 Net farm profit (loss) F1040 5 Net gain (loss) F4797 6 $9,000 Other income or (loss) 7 Total income. Add lines 3 through 10 8 $363,957 Salaries and wages (less employment 9 credits) $150,000 Guaranteed payments to partners 10 $110,000 Repairs and maintenance 11 $5,562 Bad debts 12 Rent 13 $265,740 Taxes and licenses 14 $33,450 Interest 15 $95,362 Depreciation (attach Form 4562) 16a $100,976 Less depreciation claimed on Sch A 16b Total depreciation 16c $100,976 Depletion 17 Retirement plans, etc 18 Employee benefit programs 19 $1,250 Other deductions 20 $310,222 Attachment 3 Total deductions (add lines 9 – 20) 21 $1,072,562 Ordinary business income (loss) (Subtract 22 Line 21 from Line 8 ($708,605) Schedule 1 2 3 4 5 6 7 8 9a (i) 9a (ii) A Cost of Goods Sold Inventory at beginning of year Purchases less cost of items Cost of labor Additional section 263A costs Other costs Total. Add lines 1 - 5 Inventory at the end of year Cost of goods sold. Subtract Line 7 from 6 Cost in regulations 1.471-3 Lower of cost or market
$5,602,453 $131,245 $5,733,698 $2,225,675 $3,508,023 X
Jennings Boats LLC
Other Check if writedown Check if the LIFO was adopted Section 263A rules apply … Change in determining quantities, cost, valuations Schedule B Other Information Domestic general partnership 1a Domestic limited partnership 1b Domestic limited liability company 1c Domestic limited liability partnership 1d Foreign partnership 1e Other 1f Any partners in this partnership also 2 partnerships? Partnership own interest in another 3 partnership or foreign entity? Partnership file Form 8893? 4 Partnership total receipts <$250,000 5a Partnership total assets <$600,000 5b Filed Schedule K-1 with return? 5c Partnership have foreign partners? 6 Partnership publicly traded partnership? 7 Partnership filed F8264? 8 Partnership have an interest in or a 9 signature, or other authority over financial account in foreign country? Partnership receive distribution from, 10 granter of, transferor to foreign trust? Distribution of property or transfer of 11 partnership interest? Number of Forms 8865 attached 12 Name of designated TMP Identifying number of TMP 9a (iii) 9b 9c 9d 9e Address of designated TMP Schedule K Partners’ Distributive Share Items Ordinary business income (loss) 1 Net rental real estate income (loss) 2 Other gross rental income (loss) 3a Other rental activities expenses 3b Other net rental income (loss) Subtract 3c Line 3b from 3a Guaranteed payments 4 Interest Income 5 Ordinary dividends 6a Qualified dividends 6b Royalties 7 Net short-term capital gain (loss) 8 Net long-term capital gain (loss) 9a Collectibles (28%) gain (loss) 9b Unrecaptured section 1250 gain 9c Net section 1231 gain (loss) 10 Other income (loss) 11 Section 179 deduction 12 Contributions 13a Investment interest expenses 13b
66-0000002
N N
X
N N N N N N N N N N N N 0
($708,605)
$110,000 $250
Jennings Boats LLC
13c 13c (2) 13d 14a 14b 14c 15a 15b 15c 15d 15e 15f 16a 16b 16c 16d 16e 16f 16g 16h 16i 16j 16k 16l 16m 16n 17a 17b 17c 17d 17e 17f 18a 18b 18c 19a 19b 20a 20b 20c Section 59(e)(2) expenditures (type) Section 59(e)(2) expenditures (amount) Other deductions Net earnings (loss) self employment Gross farming or fishing income Gross nonfarm income Low-income housing credit 42(j)(5) Low-income housing credit (other) Qualified rehabilitation expenditures Other rental real estate credits Other rental credits Other credits and credit recapture Name of country or U.S. possession Gross income from all sources Gross income sourced at partnership level Passive Listed categories General limitation Interest expense Other Passive Listed categories General limitation Total foreign taxes Paid □ Accrued □ Reduction in taxes available for credit Other foreign tax information Post 1986 depreciation adjustment Adjusted gain or loss Depletion (other than oil and gas) Oil, gas, and geothermal properties-gross income Oil, gas, and geothermal propertiesdeductions Other AMT items Tax-exempt interest income Other tax-exempt income Nondeductible expenses Distrib of cash & marketable securities Distributions of other property Investment income Investment expenses Other items and amounts ($303,803) $4,516,783
66-0000002
$600 $250
Jennings Boats LLC
Analysis of Net Income (Loss) Net income (loss) Combine SchK line 1 – 11; Subtract sum SchK line 12 - 13d, and 16l (i) Corporate (ii) (iii) Individual Individual (active) (passive) Analysis 2a ($299,178) by General partners Analysis 2b ($299,177) by Limited partners Schedule L Balance Sheets per Books Beginning of tax year 1 1 2a 2b 3 4 5 6 7 8 9a 9b 10a 10b 11 12a 12b 13 14 15 16 17 18 19 Assets Cash Trade notes Less allowance Inventories U.S. govt oblig Tax-exempt securities Other current assets Mortgage & real estate loan Other investments Bldgs & other deprec assets Less accumulated deprec Depletable assts Less accumulated depletion Land Intangible assets Less accum amortization Other assets Total assets Liabilities Accounts payable Mortgages, notes, bonds payable < 1yr Other current liabilities All nonrecourse loans Mortgages, notes, bonds (a) (b)
66-0000002
($598,355) (iv) Partnership652 (v) Exempt organization (vi) Nominee Other
End of tax year (c) $42,555 $42,555 $2,225,675 (d) $75,500
Write-in / Literal
$501,229 $100,976 $400,253
$6,000 $500 (a) (b) (c) $5,500 $2,749,483 (d) $195,242
$345,622
Jennings Boats LLC
66-0000002
payable > 1yr Other liabilities $2,375,869 Partners’ capital accounts ($467,250) Total labilities 22 and capital $2,749,483 Schedule M-1 Reconciliation of Income (Loss) per Books With Income per Return Line Description Line Amount Write-in / Literal Net Income (loss) per books 1 ($517,250) Income included on SchK lines 1, 2, 3c, 5, 2 6a, 7, 8, 9a, 10, 11, not recorded on the books this year (itemized): 2 Total Income Included 3 Guaranteed payments (other than health insurance) 4a Expenses recorded on books (itemize) Depreciation 4b Travel & entertainment $600 Dependency 4 Total Income Expenses 5 Add lines 1 – 4 ($517,850) 6a Income recorded on books (itemize) taxexempt interest 6 Total Income Recorded 7a Deductions not charged against book (itemize) depreciation $80,505 Dependency 7 Total Itemized Deductions 8 Total Income/Deductions Add lines 6 and 7 8 $80,505 Income (loss) (Analysis of net income 9 (loss) line 1). Subtract line 8 from line 5 ($598,355) Schedule M-2 Analysis of Partners’ Capital Accounts Balance at beginning of year 1 Capital contributed - Cash 2a $50,000 Capital contributed - Property 2b Net income (loss) per books 3 ($517,250) Other increases (itemized) 4 Add lines 1 through 4 5 ($467,250) Distributions – Cash 6a Distributions – Property 6b Other decreases (itemized) 7 Add lines 6 and 7 8 Balance at end of year. Subtract line 8 9 from line 5 ($467,250) 20 21
Jennings Boats LLC
66-0000002
Form 4562 Depreciation and Amortization 2006 Name: Jennings Boats LLC Business or Activity: Boat Sales EIN: 66-0000002 Line Description Line Amount Write-in / Literal / Attachments Part I Election to Expense Certain Property Under Section 179 Maximum amount 105,000 1 Total cost of section 179 prop 2 Threshold cost of section 179 prop 420,000 3 Reduction in limitation 4 Dollar limitation for TY 5 Description of Property 6(a) Cost 6(b) Elected cost 6(c) Listed property 7 Total elected cost of sec 179 prop 8 Tentative deduction 9 Carryover of disallowed deduction 10 Business income limitation 11 Section 179 expense deduction 12 Carryover of disallowed deduction 13 Part II Special Depreciation Allowance and Other Depreciation Special depreciation allowed 14 $73,490 Property subject to sec 168(f)(1) election 15 Other depreciation 16 625,392 Part III MACRS Depreciation - Section A 17 MACRS deductions 2,743,901 Sec 168(i)(4) election 18 Section B – Assets Placed in Service During 2006 Tax Year Using the General Depreciation System (a)Classification (b)Mont (c) Basis (d)Recovery (e) (f)Meth (g)Deprc of property h& for deprec period Conventi od deduct Year on 3-year property $22,444 3 yrs HY 200DB $7,481 5-year property $1,500 5 yrs HY 200DB $300 7-year property $26,555 7 yrs HY 200DB $3,792 10-year property 15-year property 20-year property 25-year property S/L Residential rental MM S/L property Nonresidential real 19i $425,600 39 yrs MM S/L $10,913 property Section C – Assets Placed in Service During 2006 Tax Year Using the Alternative Depreciation System Class life 20a 12-year S/L 20b 40-year MM S/L 20c Part IV Summary Listed property 21 $5,000 Total 22 $100,976 Assets for CY 23 19a 19b 19c 19d 19e 19f 19g 19h Part V Listed Property Section A – Depreciation and Other Information
Write-in / Literal / Attachments
Jennings Boats LLC
66-0000002
Form 4562 Depreciation and Amortization 2006 Evidence? 24a Evidence written? 24b Special depreciation allowance 25 Type of property 26(a) 2006 Pilot Date in service 26(b) 07/21/2006 Business investment % 26(c) 100% Cost or other basis 26(d) $25,000 Basis for depreciation 26(e) $25,000 Recovery period 26(f) 5 Yrs Method/Convention 26(g) 200HY Depreciation deduction 26(h) $5,000 Election Sec 179 cost 26(i) Type of property 27(a) Date in service 27(b) Business investment % 27(c) Cost or other basis 27(d) Basis for depreciation 27(e) Recovery period 27(f) Method/Convention 27(g) Depreciation deduction 27(h) Election Sec 179 cost 27(i) Add column (h), lines 25 - 27 28 $5,000 Add column (i), line 26 29 Section B – Information on Use of Vehicles Total bus/invest miles driven 30(a) Total commuting miles driven 31(a) Tot other personal miles driven 32(a) Total miles driven 33(a) Vehicle available for personal use? 34 Vehicle used > 5% ? 35 Another vehicle avail for personal use? 36 Section C – Questions for Employers Who Provide Vehicles for Use by Their Employees Maint written policy prohibits commu? 37 Maint written policy prohibits pers use 38 Vehicles treated as personal use? 39 Provide > 5 vehicle? 40 Qualified auto demonstration use? 41 Part VI Amortization (a) (b) (c) (d) (e) (f) Depreciation of Date amort Amort Code Amort Amort costs begins amount section period or for this percent Yr 42 43 44 Start up Amort of costs before 2006 TY Total 01/01/2006 $6,000 195 5 Yr $500 $500
Write-in / Literal / Attachments
Jennings Boats LLC
66-0000002
Form 4797 Sales of Business Property 2006 Name: Jennings Boats LLC EIN: 66-0000002 Line Description Line Amount Write-in / Literal / Attachments Gross receipts fm sales or exchg 1 Part I Sales or Exchanges of Property Used in a Trade or Business Description of property 2(a) Date acquired 2(b) Date sold 2(c) Gross sales price 2(d) Depreciation allowed 2(e) Cost or other basis 2(f) Gain or (loss) 2(g) Gain fm F4684 3 Sec 1231 gain fm F6252 4 Sec 1231 gain fm F8824 5 Gain fm casualty or theft 6 Combine lines 2 to 6 7 Nonrecaptured net sec 1231 loss 8 Subtract line 8 from line 7 9 Part II Ordinary Gains and Losses 10(a) Description of property 10(b) Date acquired Date sold 10(c) 10(d) Gross sales price Depreciation allowed 10(e) Cost or other basis 10(f) 10(g) Gain or loss Loss fm line 7 11 Gain fm line 7 12 Gain fm line 31 13 Net gain F4684 14 Ordinary gain F6252 15 Ordinary gain F8824 16 $9,000 Combine lines 10 to16 17 $9,000 Part of loss F4684 18a Redetermined gain or (loss) on line 17 18b Part III Gain for Disposition of Property Under Sections 1245, 1250, 1252, 1254 and 1255 19(a) Description of property 19(b) Date acquired Date sold 19(c) Gross sales price 20 Cost or other basis 21 Depreciation allowed 22 Adjusted basis 23 Total gain 24 Depreciation allowed 25a Smaller of lines 24 and 25a 25b Additional depreciation after 1975 26a Applicable % 26b Subtract line 26a from line 24 26c Additional depreciation after 1969 26d Line Description Line Amount Write-in / Literal / Attachments Smaller of lines 26c and 26c 26e Sec 291 amount 26f Add lines 26b,26e and 26f 26g
Jennings Boats LLC
Form 4797 Sales of Business Property Soil, water, land 27a Line 27 multiplied by applicable % 27b Smaller of lines 24 and 27b 27c Intangible drilling 28a Smaller of lines 24 and 28a 28b Applicable % of payment excluded 29a Smaller of lines 24 and 29a 29b Total gain all property 30 10,000 Add property columns A – D 31 10,000 Subtract line 31 from line 30 32 Part IV Recapture Amounts Under Sections 179 and 280F(b)(2) 33(a) Sec 179 expn ded – Sec 179 33(b) Sec 179 expn ded – Sec 280F(b) 34(a) Recomputed deprc – Sec 179 34(b) Recomputed deprc- Sec280F(b) 35(a) Recapture amount – Sec 179 35(b) Recapture amount – Sec 280F(b)
66-0000002
2006
Form 8271
Investor Reporting of Tax Shelter Registration Number Investor’s name shown on return: Jennings Boats LLC Investor’s Identifying number: 66-0000002 Investor’s tax year ended 12/31/2006 (a) Tax shelter Name (b) Tax shelter Registration # 1 XYZ Shelter 11111111111 2 3 4 5 6 7 8 9 10
2006
(c) Tax shelter identifying number 11-0000011
Form 8824 Like-Kind Exchanges Name: Jennings Boats LLC Identifying number: 66-0000002 1 Description of like-kind property given up 2 Description of like-kind property received 3 Date like-kind property given up was originally acquired (month, day, year) 4 Date you actually transferred your property to other party (month, day, year) 5 Date like-kind property you received was identified by written notice to another party (month, day, year) 6 Date you actually received the like-kind property from other party (month, day, year)
2006
1998 Honda Accord 2006 Pilot 09/06/1999 07/21/2006 07/21/2006 07/21/2006
Jennings Boats LLC
66-0000002
Was exchange of property given up or received made with a related party, either directly or indirectly. If yes, complete Part II. If no, go to Part III □Yes □No Part II Related Party Exchange Information Name of related party Relationship to you 8 9
7
NO
Related party’s identifying number
Address During this tax year (and before the date that is 2 years after the last transfer of property that was part of the exchange), did the related party directly or indirectly (such as through and intermediary) sell or dispose of any part of the like-kind property received from you in the exchange? □Yes □No During this tax year (and before the date that is 2 years after the last transfer of property that was part of the 10 exchange), did you sell or dispose of any part of the like-kind property you received? □Yes □No If one of the exceptions below applies to the disposition, check the applicable box: 11 a □ The disposition was after the death of either of the related parties b □ The disposition was an involuntary conversion, and the threat of conversion occurred after the exchange c □ You can establish to the satisfaction of the IRS that neither the exchange nor the disposition had tax avoidance as its principal purpose. If box checked, attach an explanation Name shown on tax return: Your social security number” Part III Realized Gain or (Loss), Recognized Gain, and Basis of Like-Kind Received Line Description Line Amount Write-in / Literal / Attachments Fair market Value (FMV) of other property 12 given up Adjusted basis of other property given up 13 Gain or (loss) recognized on other property 14 given up. Subtract line 13 from line 12 Cash received, FMV of other property 15 received, plus liabilities assumed by other party, reduced (but below zero) by exchange expenses you incurred $9,000 FMV of like-kind property your received 16 $30,000 Add lines 15 and 16 17 $39,000 Adjusted basis of like-kind property you 18 gave up, net amounts paid to other party, plus any exchange expenses not used on line 15 $25,000 Realized gain or (loss). Subtract line 18 19 from line 17 $14,000 Enter smaller of line 15 or line 19 20 $9,000 Ordinary income under recapture rules. 21 Enter her on F4797 line 16 Subtract line 21 from lien 20. Enter here 22 and on Sch D or F4797, unless installment method applies $9,000 Recognized gain. Add lines 21 and 22 23 $9,000 Deferred gain or (loss). Subtract line 23 24 from line 19. $5,000 Basis of like-kind property received. 25 Subtract line 15 from the sum of lines 18 and 23 $25,000
Jennings Boats LLC
66-0000002
Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 □ Amended K-1 □ Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000002 Partnership's name, address, city, state, and Zip B Jennings Boats LLC code RT 1 Box 843 Bar Harbor, ME 04609 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D Tax shelter registration number, if any E Check if Form 8271 is attached X F Part II Information About the Partner Partner's Identification number G 001-06-0004 Partner's name, address, city, state and ZIP code H Horace Jennings PO Box 1589 Bar Harbor, ME 04609 □ General partner or LLC member-manager I General partner or LLC □ Limited partner or other LLC member member-manager □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Individual Partner’s share of profit, loss and capital L Beginning% Ending% Profit 0 50 Loss 0 50 Capital 0 50 Partner’s share of liabilities at year end: M Nonrecourse $ Qualified nonrecourse financing $ Recourse $ $2,375,869 Partner’s capital account analysis: N Beginning capital account $ Capital contributed during the year $ $25,000 Current year increase (decrease) $ ($258,625) Withdrawals & distributions $ Ending capital account $ ($233,625) □ Tax basis □ GAAP □ Sect 704(b) book □ Other (explain) Tax Basis Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 ($354,303) Net rental real estate income (loss) 2 Other net rental income (loss) 3 Guaranteed payments 4 $110,000 Interest income 5 $125 Ordinary dividends 6a Qualified dividends 6b Royalties 7 Net short-term capital gain (loss) 8 Net long-term capital gain (loss) 9a Collectibles (28%) gain (loss) 9b
Jennings Boats LLC
9c 10 11 12 13 14 15 16 17 18 19 20 Unrecaptured section 1250 gain Net section 1231 gain (loss) Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions Alternative minimum tax (AMT) items Tax-exempt income & nondeductible expense Distributions Other Information
66-0000002
A ($151,902) C $2,258,392 M $200 U $178 C $300 A $125
Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 □ Amended K-1 □ Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000002 Partnership's name, address, city, state, and Zip B Jennings Boats LLC code RT 1 Box 843 Bar Harbor, ME 04609 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D Tax shelter registration number, if any E Check if Form 8271 is attached X F Part II Information About the Partner Partner's Identification number G 001-06-0005 Partner's name, address, city, state and ZIP code H Lionel Colbert 4640 Madison Ln Boston, MA 02109 □ General partner or LLC member-manager I Limited partner or other □ Limited partner or other LLC member LLC member □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Individual Partner’s share of profit, loss and capital L Beginning% Ending% Profit 0 50 Loss 0 50 Capital 0 50 Partner’s share of liabilities at year end: M Nonrecourse $ Qualified nonrecourse financing $ Recourse $ $2,375,869 Partner’s capital account analysis: N Beginning capital account $ Capital contributed during the year $ $25,000 Current year increase (decrease) $ ($258,625) Withdrawals & distributions $ Ending capital account $ ($233,625) □ Tax basis □ GAAP □ Sect 704(b) book □ Other (explain) Tax Basis
Jennings Boats LLC
66-0000002
Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 ($354,302) Net rental real estate income (loss) 2 Other net rental income (loss) 3 Guaranteed payments 4 Interest income 5 $125 Ordinary dividends 6a Qualified dividends 6b Royalties 7 Net short-term capital gain (loss) 8 Net long-term capital gain (loss) 9a Collectibles (28%) gain (loss) 9b Unrecaptured section 1250 gain 9c Net section 1231 gain (loss) 10 Other income (loss) 11 Section 179 deduction 12 Other deductions 13 Self-employment earnings (loss) 14 A $27,500 C $2,258,391 Credits & credit recapture 15 M $200 U $178 Foreign transactions 16 Alternative minimum tax (AMT) items 17 Tax-exempt income & nondeductible expense 18 C $300 Distributions 19 Other Information 20 A $125
Carlton Asset Management
TEST SCENARIO 3
66-0000003
FORMS REQUIRED: 1065, Schedule M-3 (Form 1065) 4562, 8865, 1065 SCH K-1 (3), 8865, 8865 SCH O, 8865 SCH P, DEPENDENCIES ATTACHMENTS: Ordinary Income (Loss) From Other Partnerships, Estates, and Trusts Statement Other Income (Loss) Statement Itemized Other Deduction Statement Publicly Traded Partnership Statement Ownership of Any Interest in Another Partnership or Foreign Entity Statement Section 754 Election Income (Loss) From Foreign Partnerships Schedule BINARY ATTACHMENTS: None HEADER INFO: Tax Period: Calendar Year 2006 Preparer Firm: Electronic Tax Filers, Inc 123 Any Street Anytown, NY 11717 MultipleSoftwarePackagesUsed: Yes or No Originator: EFIN: Self-select Type: ERO PractionerPIN: EFIN: Self-select PIN: Self-select PIN Entered by – ERO 66-0000003
Signature Option: PIN Number Return Type: Filer: EIN: 66-0000003 Name: Carlton Asset Management L P Name Control: CARL Address: 1678 South Hoover Blvd San Francisco, CA 94101 Name: Tony Carlton Title: President Taxpayer PIN: Phone: 555-555-5555 Email Address: Anymail@email.com DateSigned: 03/15/2006 Name: John Smith SSN: 153-10-0001 Phone: 631-555-1212 Email Address: Anymail@email.com Date Prepared: 03/14/2006 Self Employed: No N/A
Partner:
Preparer:
IRS PAYMENT:
Carlton Asset Management
Details for attachments to Form
66-0000003
Attachment 1, Form 1065, Line 4 (Ordinary Income (Loss) From Other Partnerships, Estates, and Trusts Statement) Partnership, Estate or Trusts Name Mai Tai Investments Address 1-2-3 Ginsu Chuo-Ku Tokyo, 190-2182 EIN 11-0000001 Trade or Business Activity Security Dealing Amount $10,229,525
Attachment 2, Form 1065, Page 1, Line 7 (Other Income (Loss) Statement) Cancellation of Debt Services Fees $540,000 $399,880,252
Attachment 3, Form 1065, Page 1, Line 20 (Itemized Other Deductions Statement) Legal and Accounting Bank Fees Travel and Entertainment $216,572 $142,080 $40,000
Attachment 4, Form 1065 (Publicly Traded Partnership Statement) 3.5% Publicly Traded Partnership Tax $14,372,742 Overpayment 0 Balance Due 0 Zero Liability 0 Data Stream for Computation Total Income multiplied by 3.5%
Attachment 5, Form 1065, Schedule B, Question 3 (Ownership of Any Interest in Another Partnership or Foreign Entity Statement) Type of Entity Partnership Entity Name Mai Tai Partnership EIN 11-0000001 Country Japan
Attachment 6, Form 1065, Page 2, Schedule B, Line 11 (Section 754 Election)
Name of Partnership Partnership Address Section 754 Declaration Carlton Asset Management L P
1678 South Hoover Blvd San Francisco, CA 94101
We elect under code section 754 to adjust the inside basis or partnership assets in accordance with code section 743, 734 and 755.
Attachment 7, Form 1065, Schedule M-3, Part II, Line 8 (Income (Loss) From Foreign Partnerships Schedule) Name Mai Tai Invest ments EIN 11-0000001 EOY Profit Sharing Percentage 25% EOY Loss Sharing Percentage 25% Income per Income Statement $10,229,525 Amount $10,229,525
Carlton Asset Management
66-0000003
Form 1065 Test U.S. Return of Partnership Income Tax 2006 Calendar Year 2006 or tax year beginning 1/1 , 2006, ending 12/31 , 2006 Principal business activity A Management Principal product or service B Financial Investment Business code number C 523900 Name and Address: Carlton Asset Management L P 1678 South Hoover Blvd San Francisco, CA 94101 Employer Identification number D 66-0000003 Date business started E 10/23/1998 Total assets F $5,416,542 Check applicable boxes 1,2,3,4,5 G Check accounting method 1,2,3 H 1 Number of Schedule K-1 I 3 Check if Schedule M-3 Required (attach J Schedule M-3) Line Description Line Amount Write-in / Literal / Attachment Gross receipts or sales 1a Less returns and allowances 1b Balance 1c Cost of goods sold (Sch A, line 8) 2 Gross profit. Subtract line 2 from 1c 3 Ordinary income or (loss) 4 $10,229,525 Attachment 1 Net farm profit (loss) F1040 5 Net gain (loss) F4797 6 Other income or (loss) 7 $400,420,252 Attachment 2 Total income. Add lines 3 through 10 8 $410,649,777 Salaries and wages (less employment 9 credits) $1,222,990 Guaranteed payments to partners 10 $561,900 Repairs and maintenance 11 $8,610 Bad debts 12 Rent 13 $729,654 Taxes and licenses 14 $871,972 Interest 15 Depreciation (attach Form 4562) 16a $19,433 Less depreciation claimed on Sch A 16b Total depreciation 16c $19,433 Depletion 17 Retirement plans, etc 18 $345,678 Employee benefit programs 19 Other deductions 20 $398,652 Attachment 3 Total deductions (add lines 9 – 20) 21 $4,158,889 Ordinary business income (loss) (Subtract 22 Line 21 from Line 8 $406,490,888 Schedule A Cost of Goods Sold Inventory at beginning of year 1 Purchases less cost of items 2 Cost of labor 3 Additional section 263A costs 4 Other costs 5 Total. Add lines 1 - 5 6 Inventory at the end of year 7 Cost of goods sold. Subtract Line 7 8 from 6 Cost in regulations 1.471-3 9a (i) Lower of cost or market 9a (ii) Other 9a (iii) Check if writedown 9b
Carlton Asset Management
Check if the LIFO was adopted Section 263A rules apply … Change in determining quantities, cost, valuations Schedule B Other Information Domestic general partnership 1a Domestic limited partnership 1b Domestic limited liability company 1c Domestic limited liability partnership 1d Foreign partnership 1e Other 1f Any partners in this partnership also 2 partnerships? Partnership own interest in another 3 partnership or foreign entity? Partnership file Form 8893? 4 Partnership total receipts <$250,000 5a Partnership total assets <$600,000 5b Filed Schedule K-1 with return? 5c Partnership have foreign partners? 6 Partnership publicly traded partnership? 7 Partnership filed F8264? 8 Partnership have an interest in or a 9 signature, or other authority over financial account in foreign country? Partnership receive distribution from, 10 granter of, transferor to foreign trust? Distribution of property or transfer of 11 partnership interest? Number of Forms 8865 attached 12 Name of designated TMP Identifying number of TMP 9c 9d 9e Address of designated TMP Schedule K Partners’ Distributive Share Items Ordinary business income (loss) 1 Net rental real estate income (loss) 2 Other gross rental income (loss) 3a Other rental activities expenses 3b Other net rental income (loss) Subtract 3c Line 3b from 3a Guaranteed payments 4 Interest Income 5 Ordinary dividends 6a Qualified dividends 6b Royalties 7 Net short-term capital gain (loss) 8 Net long-term capital gain (loss) 9a Collectibles (28%) gain (loss) 9b Unrecaptured section 1250 gain 9c Net section 1231 gain (loss) 10 Other income (loss) 11 Section 179 deduction 12 Contributions 13a Investment interest expenses 13b Section 59(e)(2) expenditures (type) 13c Section 59(e)(2) expenditures (amount) 13c (2)
66-0000003
X
Y Y N N N N N N N N N Y 1 Attachment 6 Attachment 5
$406,490,888
$561,900 $36,525
$43,332
Carlton Asset Management
13d 14a 14b 14c 15a 15b 15c 15d 15e 15f 16a 16b 16c 16d 16e 16f 16g 16h 16i 16j 16k 16l 16m 16n 17a 17b 17c 17d 17e 17f 18a 18b 18c 19a 19b 20a 20b 20c Other deductions Net earnings (loss) self employment Gross farming or fishing income Gross nonfarm income Low-income housing credit 42(j)(5) Low-income housing credit (other) Qualified rehabilitation expenditures Other rental real estate credits Other rental credits Other credits and credit recapture Name of country or U.S. possession Gross income from all sources Gross income sourced at partnership level Passive Listed categories General limitation Interest expense Other Passive Listed categories General limitation Total foreign taxes Paid □ Accrued □ Reduction in taxes available for credit Other foreign tax information Post 1986 depreciation adjustment Adjusted gain or loss Depletion (other than oil and gas) Oil, gas, and geothermal properties-gross income Oil, gas, and geothermal propertiesdeductions Other AMT items Tax-exempt interest income Other tax-exempt income Nondeductible expenses Distri of cash & marketable securities Distributions of other property Investment income Investment expenses Other items and amounts
66-0000003
$41,210,989 $365,279,899
$10,229,525
$632,510
$1,111 $408,202,737 $36,525
Carlton Asset Management
66-0000003
Analysis of Net Income (Loss) Net income (loss) Combine SchK line 1 – 11; Subtract sum SchK line 12 - 13d, and 16l (i) Corporate (ii) (iii) Individual Individual (active) (passive) Analysis 2a by General partners Analysis 2b by $4,064,134 Limited partners Schedule L Balance Sheets per Books Beginning of tax year 1 1 2a 2b 3 4 5 6 7 8 9a 9b 10a 10b 11 12a 12b 13 14 15 16 17 18 19 Assets Cash Trade notes Less allowance Inventories U.S. govt oblig Tax-exempt securities Other current assets Mortgage & real estate loan Other investments Bldgs & other deprec assets Less accumulated deprec Depletable assts Less accumulated depletion Land Intangible assets Less accum amortization Other assets Total assets Liabilities Accounts payable Mortgages, notes, bonds payable < 1yr Other current liabilities All nonrecourse loans Mortgages, (a)
$406,413,471 (iv) Partnership652 (v) Exempt organization (vi) Nominee Other
$40,641,347
$361,707,990
End of tax year (c) $42,555 (d) $6,027,450
Write-in / Literal
(b) $5,222,150
$1,621,740 $1,372,379 $249,361
$1,682,950 $1,435,144 $247,806
(a)
$5,481,751 (b) $433,823
(c)
$6,275,256 (d) $3,049,605
$540,000
Carlton Asset Management
66-0000003
notes, bonds payable > 1yr Other liabilities 20 $2,375,869 Partners’ capital 21 accounts $5,047,928 $2,685,651 Total liabilities 22 and capital $5,481,751 $6,275,256 Schedule M-1 Reconciliation of Income (Loss) per Books With Income per Return Line Description Line Amount Write-in / Literal Net Income (loss) per books 1 Income included on SchK lines 1, 2, 3c, 5, 2 6a, 7, 8, 9a, 10, 11, not recorded on the books this year (itemized): Total Income Included 2 Guaranteed payments (other than health 3 insurance) Expenses recorded on books (itemize) 4a Depreciation Travel & entertainment 4b Total Income Expenses 4 Add lines 1 – 4 5 Income recorded on books (itemize) tax6a exempt interest Total Income Recorded 6 Deductions not charged against book 7a (itemize) depreciation Total Itemized Deductions 7 Total Income/Deductions 8 Add lines 6 and 7 8 Income (loss) (Analysis of net income 9 (loss) line 1). Subtract line 8 from line 5 Schedule M-2 Analysis of Partners’ Capital Accounts Balance at beginning of year 1 $5,037,928 Capital contributed - Cash 2a Capital contributed - Property 2b Net income (loss) per books 3 $405,850,460 Other increases (itemized) 4 Add lines 1 through 4 5 $410,888,388 Distributions – Cash 6a $408,202,737 Distributions – Property 6b Other decreases (itemized) 7 Add lines 6 and 7 8 Balance at end of year. Subtract line 8 9 from line 5 $2,685,651
Carlton Asset Management
66-0000003
Form Schedule M-3 (1065) Net Income (Loss) Reconciliation for Certain Partnerships Name: Carlton Asset Management L P EIN: 66-0000003 Line Description Line Amount / Information Write-in / Literal Total Assets End Of Tax Year is A Equal to $10 million or more Adjusted Total Assets For Year is Equal to $10 million or more B Total Receipts For Taxable Year is Equal to $35 million or more C X An Entity that is a Reportable Entity Partner…deemed to own interest 50 percent or more… D Voluntary Filer E Part I Financial Information and Net Income (Loss) Reconciliation Did Partnership File SEC Form 10K 1a Yes Did Partnership Prepare Certified Audited Income Statement 1b Did Partnership Prepare Income Statement 1c Beginning Income Statement Period 2a 01/01/2006 Ending Income Statement Period 2a 12/31/2006 Has Partnership’s Income Statement Been Restated 2b No Has Partnership’s Income Statement Been Restated For Any Of Five Statement Periods 2c No Worldwide Consolidated Net Income (Loss) 3 $405,850,460 Net Income From Nonincludible Foreign Entities 4a Net Income Nonincludible Foreign Entities 4b Net Income From Nonincludible U.S. Entities 5a Net Income From Nonincludible US Entities 5b Other Includible Entities Schedule 6a Net Loss Of Other Nonincludible Entries 6b Adjustment To Eliminations Of Transactions Between Partnership And Nonincludible Entities 7 Adjustment to reconcile income statement period 8 Other adjustments 9 Net income (Loss) 10 $405,850,460
Carlton Asset Management
66-0000003
Schedule M-3 (Form 1065) 2006 Page 2 PART II RECONCILIATION OF NET INCOME (LOSS) PER INCOME STATEMENT OF PARTNERSHIP WITH INCOME (LOSS) PER RETURN (a) Income (b) Temp (c) Perm (d) Income Write-in / (loss) per Difference Difference (loss) per Tax Literal Income Stmt Return Income (Loss) From Equity Method Foreign Corporations 1 Gross Foreign Dividends Not Previously Taxed Temporary Difference 2 Subpart F, QEF, And Similar Income Inclusions 3 Gross Foreign Distributions Previously Taxed 4 Income (Loss) From Equity Method U.S. Corporations 5 U.S. Dividends 6 Income (Loss) From U.S. Partnerships 7 Income (Loss) From Attachment 7 Foreign Partnerships 8 $10,229,525 $10,229,525 Income (Loss) From Other Pass-Through Entities 9 Items Relating To Reportable Transactions 10 Interest Income 11 Total Accrual To Cash Adjustment 12 Hedging Transactions 13 Mark-To-Market Income (Loss) 14 Cost Of Goods Sold 15 Sale Versus Lease 16 Section 481(a) Adjustments 17 Unearned/Deferred Revenue 18 Income Recognition From Long-Term Contracts 19 OID Discount And Other Imputed Interest 20 Income Statement gain/loss…other than Inventory and PassThrough Entities 21a Gross Capital Gains From Schedule D 21b Gross Capital Losses From Schedule D 21c 21d Net Gain/Loss Reported
Carlton Asset Management
on Form 4797 Abandonment Losses Worthless Stock Losses Other Gain/Loss On Disposition Of Assets Other Income (Loss) Items With Differences Total Income (Loss) Items Total Expense/Deduction Items Other Income (Loss) And Expense/Deduction Items Reconciliation Totals
66-0000003
21e 21f 21g 22 23 24 25 26
$10,229,525 $2,222 $395,618,713 $405,850,460 $563,011
$10,229,525 $563,011 $395,620,935 $406,413,471
$563,011
Schedule M-3 (Form 1065) 2006 Page 3 PART III RECONCILIATION OF NET INCOME (LOSS) PER INCOME STATEMENT OF PARTNERSHIP WITH INCOME (LOSS) PER RETURN – EXPENSE/DEDUCTION ITEMS Equity-based compensation Meals and Entertainment $2,222 $1,111 $1,111 Fines and Penalties Judgments, damages… Guaranteed Payments $561,900 $561,900 Pension And ProfitSharing Other Post-Retirement Benefits Deferred Compensation Charitable Contribution Of Cash And Tangible Property Charitable Contribution Of Cash And Intangible Property Organizational Expenses as per 1.7092(a) Organizational Expenses as per 1.7092(b) Current Year Acquisition/Reorganiz ation Investment Banking Fees Current Year Acquisition/Reorganiz ation Investment Accounting Fees Amortization/Impairm ent Of Goodwill Amortization Of
1 2 3 4 5 6 7
8 9
10 11 12
13
14 15 16
Carlton Asset Management
Acquisition, Reorganization, And Start-Up Costs Other Amortization Or Impairment Write-Offs Section 198 Environmental Remediation Costs Depletion Depreciation Bad Debt Expenses Interest Expense Purchase Versus Lease Domestic Production Activities Deduction Other Expenses/Deduction Items With Differences Total Expenses/Deduction Items
66-0000003
17 18 19 20 21 22 23
24
25 26
$2,222
$563,011
$563,011
Carlton Asset Management
66-0000003
Form 4562 Depreciation and Amortization 2006 Name: Carlton Asset Management LP Business or Activity: Carlton Asset Management LP EIN: 66-0000003 Line Description Line Amount Write-in / Literal / Attachments Part I Election to Expense Certain Property Under Section 179 Maximum amount 105,000 1 Total cost of section 179 prop 2 Threshold cost of section 179 prop 420,000 3 Reduction in limitation 4 Dollar limitation for TY 5 Description of Property 6(a) Office Equipment Cost 6(b) $23,456 Elected cost 6(c) $23,456 Description of Property 6(a) Furniture/fixtures Cost 6(b) $19,876 Elected cost 6(c) $19,876 Listed property 7 Total elected cost of sec 179 prop 8 $43,332 Tentative deduction 9 $43,332 Carryover of disallowed deduction 10 Business income limitation 11 $105,000 Section 179 expense deduction 12 $43,332 Carryover of disallowed deduction 13 Part II Special Depreciation Allowance and Other Depreciation Special depreciation allowed 14 Property subject to sec 168(f)(1) election 15 Other depreciation 16 $$434 Part III MACRS Depreciation - Section A 17 MACRS deductions $18,999 Sec 168(i)(4) election 18 Section B – Assets Placed in Service During 2006 Tax Year Using the General Depreciation System (e) (f) (g) (a) (b) (c) (d) Convention Method Deprc Classification of Month Basis for Recovery deduct property & Year deprec period 3-year property 5-year property 7-year property 10-year property 15-year property 20-year property 25-year property Residential rental property Nonresidential real 19i property Section C – Assets Placed in Service During 2006 Tax Year Using the Alternative Depreciation System Class life 20a 12-year S/L 20b 40-year MM S/L 20c Part IV Summary Listed property 21 19a 19b 19c 19d 19e 19f 19g 19h
Write-in / Literal / Attachments
Carlton Asset Management
Form 4562 Total 22 Assets for CY 23 Depreciation and Amortization 2006 $19,433
66-0000003
Part V Listed Property Section A – Depreciation and Other Information Evidence? 24a Evidence written? 24b Special depreciation allowance 25 Type of property 26(a) Date in service 26(b) Business investment % 26(c) Cost or other basis 26(d) Basis for depreciation 26(e) Recovery period 26(f) Method/Convention 26(g) Depreciation deduction 26(h) Election Sec 179 cost 26(i) Type of property 27(a) Date in service 27(b) Business investment % 27(c) Cost or other basis 27(d) Basis for depreciation 27(e) Recovery period 27(f) Method/Convention 27(g) Depreciation deduction 27(h) Election Sec 179 cost 27(i) Add column (h), lines 25 - 27 28 Add column (i), line 26 29 Section B – Information on Use of Vehicles Total bus/invest miles driven 30(a) Total commuting miles driven 31(a) Tot other personal miles driven 32(a) Total miles driven 33(a) Vehicle available for personal use? 34 Vehicle used > 5% ? 35 Another vehicle avail for personal use? 36 Section C – Questions for Employers Who Provide Vehicles for Use by Their Employees Maint written policy prohibits commu? 37 Maint written policy prohibits pers use 38 Vehicles treated as personal use? 39 Provide > 5 vehicle? 40 Qualified auto demonstration use? 41 Part VI Amortization (a)Depreciation (b) Date (c) Amort (d)Cod (e)Amort (f)Amort of costs amort begins amount e period or for this section percent Yr 42 43 44
Write-in / Literal / Attachments
Amort of costs before 2006 TY Total
Carlton Asset Management
Form 8865
66-0000003
Return of U.S. Persons with Respect to Certain Foreign 2006 Partnerships Tax year beginning 1/1 , 2006 ending 12/31 , 2006 Name: Carlton Asset Management LP EIN: 66-0000003 Address: 1678 S Hoover Blvd San Francisco, CA 94101 Line Description Line Amount / Information Write-in / Literal / Attachments Category of filer A 3 Filer’s TY beginning and ending B 01/01/2006 Filer’s share of liabilities – Nonrecourse C 12/31/2006 Filer’s share of liabilities – Qualified nonrecourse C $4,800,000 Filer’s share of liabilities - Other C Name, Address, EIN D Name E(1) Address E(2) Identifying number E(3) Check applicable box E(4) Mai Tai Investments Name and address of foreign 1-2-3 Ginsu, Chuo-Ku partnership F1 Tokyo, 190-2182 EIN if any F2 11-0000001 Country under laws organized F3 Japan Date of organization F4 09/30/1992 Principal place of business F5 Japan Principal business activity code F6 523110 Principal business activity F7 Security Dealing Functional currency F8a Yen Exchange rate F8b .8739 Name, Address, EIN G1 Foreign partnership must file G2 Form 8804 Name, address of foreign agent G3 Name, address of person w/ custody of books and location G4 Special allocation made G5 No Number of F8858 G6 How is partnership classified G7 Partnership Owned separate units G8 No Meet both requirements G9 No Preparer's SSN or PTIN: 999-06-0007 Preparer Firm's name/address: Electronic Tax Filers, Inc Preparer's EIN: N/A Preparer's Phone no.: 631-555-1212 Schedule A Constructive Ownership of Partnership Interest Check boxes that apply ( a, b) A Carlton Asset Management Name LP 1678 S Hoover Blvd Address San Francisco, CA 94101 Identifying number 66-0000003 Foreign person Direct partner No Schedule A-1 Certain Partners of Foreign Partnership Name Address
Carlton Asset Management
Form 8865 Return of U.S. Persons with Respect to Certain Foreign Partnerships
66-0000003
2006
Identifying number Foreign person Schedule A-2 Affiliation Schedule Name Address EIN Total ordinary income Foreign partnership Schedule B Income Statement – Trade or Business Income Gross receipts 1a Less return and allowances 1b Net gross receipts or sales 1c Cost of good sold 2 Gross profit 3 Ordinary income 4 Net farm profit 5 Net gain (loss) 6 Other income 7 Total income 8 Salaries and wages 9 Guaranteed payments to prtnrs 10 Repairs and maintenance 11 Bad debts 12 Rent 13 Taxes and licenses 14 Interest 15 Depreciation 16a Less depreciation 16b Net depreciation 16c Depletion 17 Retirement plans 18 Employee benefits programs 19 Other deductions 20 Total deductions 21 Ordinary business income 22 Schedule D Capital Gains and Losses Part I Short-Term Capital Gains and Lasses - Assets Held One Year or Less Description of property 1(a) Date acquired 1(b) Date sold 1(c) Sales price 1(d) Cost or other basis 1(e) Gain or loss 1(f) Short-term capital gain fm F6252 2 Short-term capital gain fm F8824 3 Prntshp share of short-term gain 4 Net short-term gain 5 Part II Long-Term Capital Gains and Lasses - Assets Held More Than One Year Description of property 6(a) Date acquired 6(b) Date sold 6(c) Sales price 6(d) Cost or other basis 6(e) Gain or loss 6(f)
Carlton Asset Management
Form 8865
66-0000003
Return of U.S. Persons with Respect to Certain Foreign 2006 Partnerships Long-term capital gain fm F6252 7 Long-term capital gain fm F8824 8 Prntshp share of long-term gain 9 Capital gain distribution 10 Net long-term gain 11 Schedule K Partners Distributive Share Items Line Description Line Amount / Information Write-in / Literal Ordinary business income (loss) 1 Net rental real estate income 2 Other gross rental income (loss) 3a Expenses fm other rent activities 3b Other net rental income (loss) 3c Guaranteed payments 4 Interest income 5 Ordinary dividends 6a Qualified dividends 6b Royalties 7 Net short-term capital gain 8 Net long-term capital gain 9a Collectibles 9b Unrecaptured section 1250 gain 9c Net section 1231 gain 10 Other income 11 Sec 179 deduction 12 Contributions 13a Investment income exp 13b Sec 59(e) type 13c1 Sec 59(e) amount 13c2 Other deductibles 13d Net earnings 14a Gross farm income 14b Gross non farm income 14c Low-income housing credit 15a Low-income other 15b Qualified rehab expenditures 15c Other rental real estate credit 15d Other rental credits 15e Other credits and recapture 15f Name of country 16a Gross income all sources 16b Gross income sources 16c Passive 16d Listed categories 16e General limitation 16f Interest expense 16g Other 16h Passive 16i Listed categories 16j General limitation 16k Total foreign tax 16l Reduction in taxes 16m Other foreign tax 16n Post-1986 depreciation 17a Adjusted gain/loss 17b
Carlton Asset Management
Form 8865 Return of U.S. Persons with Respect to Certain Foreign Partnerships
66-0000003
2006
Depletion 17c Oil, gas and geothermal - gross 17d Oil, gas and geothermal - ded 17e Other AMT items 17f Tax-exempt income 18a Other tax-exempt income 18b Nondeductible expense 18c Distribution of cash 19a Distribution of other property 19b Investment income 20a Investment expenses 20b Other items and amounts 20c Schedule L Balance Sheets per Books (Not required if Q G9, page 1, is answered "Yes.") Beginning of tax year End of tax year (a) 1 2a 2b 3 4 5 6 7 8 9a 9b 10a 10b 11 12a 12b 13 14 15 16 17 18 19 20 Cash Trade notes Less allowance Inventories U.S. govt oblig Tax-exempt securities Other current assets Mortgage & real estate loan Other investments Bldgs & other deprec assets Less accumulated deprec Depletable assts Less accumulated depletion Land Intangible assets Less accum amortization Other assets Total assets Accounts payable Mortgages, notes, bonds payable < 1yr Other current liabilities All nonrecourse loans Mortgages, notes, bonds payable > 1yr Other liabilities (b) (c) (d)
Write-in / Literal
Carlton Asset Management
Form 8865 Return of U.S. Persons with Respect to Certain Foreign Partnerships
66-0000003
2006
Prnt Cap stock 21 Total liabil/cap 22 Schedule M Balance Sheets for Interest Allocation Line Description Line Amount / Information
Write-in / Literal / Attachments
Total U.S. assets – Beginning 1(a) Total U.S. assets – End 1(b) Passive income cat – Beginning 2(a) Listed categories – End 2(b) Gen limitation income – Beginning 2(c) Gen limitation income – End 2(c) Schedule M-1 Reconciliation of Income (Loss) per Books With Income (Loss) per Return Net Income 1 Income included on Sch K 2 Guaranteed payments 3 Depreciation 4a Travel & entertainment 4b Expenses recorded on books 4 Add lines 1 – 4 5 Tax-exempt interest 6a Income recorded on books 6 Depreciation 7a Deductions included on Sch K 7 Add lines 6 & 7 8 Income (loss) Subtract ln 8 from 5 9 Schedule M-2 Analysis of Partners Capital Accounts Balance at beg of year 1 Capital contrib. – Cash 2a Capital contrib. – Prop 2b Net Income (loss) per book 3 Other increases – itemized 4 Add lines 1 – 4 5 Distributions – Cash 6a Distributions – Property 6b Other decreases – item 7 Add lines 6 – 7 8 Balance at end of year. Subtract line 9 8 from line 5
Carlton Asset Management
66-0000003
Form Sch O (8865) Transfer of Property to a Foreign Partnership 2006 Name of Transferor: Carlton Asset Management L P EIN: 66-0000003 Name of Foreign Partnership: Mai Tai Investments Part I Transfer Reportable Under Section 6038B Type of (a) Date of (c) Fair (d) Cost (f) Gain (b) (e) (g) Property transfer Number market value or other Section recognized Percentage of items on date of basis 704(c) on transfer interest in transferre transfer allocation partnership d method after transfer Cash Marketable securities Inventory Tangible 08/08/2006 4 $12,345 $16,000 $25 property Intangible property Other property Supplemental Information Required To Be Reported Part II Dispositions Reportable Under Section 6038B Line Description Line Amount Write-in /Literal / Attachments Type of property (a) Date of original transfer (b) Date of disposition (c) Manner of disposition (d) Gain recognized by (e) partnership Depreciation recapture (f) recognized by partnership Gain allocated to partner (g) Depreciation recapture (h) allocated to partner Part III Any transfer reported under section 904(f)(3) or section 904(f)(5)(F)? Yes or No Checkbox No Acquisitions, Dispositions, and Changes of Interests in a Foreign Partnership Name of Person filing Form 8865: Carlton Asset Management L P EIN: 66-0000003 Name of Foreign Partnership: Mai Tai Investments Part I Acquisitions (a) Name, (b) Date of (c) Fair (d) Basis (e) Percentage of interest before Address and Acquisition market of interest acquisition ID number of value of acquired person… interest acquired Mai Tai 08/08/2006 $12,345 $16,000 0 Investments Form Sch P (8865) 2006
(f) Percentage of interest after acquisition 25
Carlton Asset Management
Form Sch P (8865)
66-0000003
Acquisitions, Dispositions, and Changes of Interests in a Foreign Partnership 2006
Part II Dispositions (a) Name, (b) Date of Address and Acquisition ID number of person…
(c) Fair market value of interest acquired
(d) Basis of interest acquired
(e) Percentage of interest before acquisition
(f) Percentage of interest after acquisition
Part III Change in Proportional Interest (a) Desc of (b) Date of (c) FMV Change Change of Interest
(d) Basis in Interest
(e) Percentage of interest before change
(f) Percentage of interest after change
Part IV Supplemental Information Required to be Reported
Carlton Asset Management
66-0000003
Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 □ Amended K-1 □ Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000003 Partnership's name, address, city, state, and Zip B Carlton Asset code Management L P 1678 S Hoover Blvd San Francisco, CA 94101 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D X Tax shelter registration number, if any E Check if Form 8271 is attached F Part II Information About the Partner Partner's Identification number G 11-0000057 Partner's name, address, city, state and ZIP code H XYZ Management 7272 W Truman Ave Sacramento, CA 95813 □ General partner or LLC member-manager I General partner or LLC □ Limited partner or other LLC member member-manager □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Partnership Partner’s share of profit, loss and capital L Beginning% Ending% Profit 10 10 Loss 10 10 Capital 10 10 Partner’s share of liabilities at year end: M Nonrecourse $ $54,000 Qualified nonrecourse financing $ Recourse $ Partner’s capital account analysis: N Beginning capital account $ $503,793 Capital contributed during the year $ Current year increase (decrease) $ $40,585,046 Withdrawals & distributions $ ($40,820,274) Ending capital account $ $268,565 □ Tax basis □ GAAP □ Sect 704(b) book □ Other (explain) Sect 704(b) book Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 $40,649,089 Net rental real estate income (loss) 2 Other net rental income (loss) 3 Guaranteed payments 4 $561,900 Interest income 5 $3,653 Ordinary dividends 6a 6b Qualified dividends Royalties 7 Net short-term capital gain (loss) 8 Net long-term capital gain (loss) 9a
Carlton Asset Management
9b 9c 10 11 12 13 14 15 16 Collectibles (28%) gain (loss) Unrecaptured section 1250 gain Net section 1231 gain (loss) Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions
66-0000003
$4,333 A $4,121,099 C $36,527,990 A Japan B $1,022,953 D $1,022,953 L $63,251 C $111 A $40,820,274 A $3,653
17 18 19 20
Alternative minimum tax (AMT) items Tax-exempt income & nondeductible expense Distributions Other Information
Carlton Asset Management
66-0000003
Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 □ Amended K-1 □ Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000003 Partnership's name, address, city, state, and Zip B Carlton Asset code Management L P 1678 S Hoover Blvd San Francisco, CA 94101 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D X Tax shelter registration number, if any E Check if Form 8271 is attached F Part II Information About the Partner Partner's Identification number G 11-0000056 Partner's name, address, city, state and ZIP code H ABC Investments 93 E Oaks Dr Los Angeles, CA 90052 □ General partner or LLC member-manager I Limited partner or other □ Limited partner or other LLC member LLC member □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Partnership Partner’s share of profit, loss and capital L Beginning% Ending% Profit 89 89 Loss 89 89 Capital 89 89 Partner’s share of liabilities at year end: M Nonrecourse $ $480,600 Qualified nonrecourse financing $ Recourse $ Partner’s capital account analysis: N Beginning capital account $ $4,483,756 Capital contributed during the year $ Current year increase (decrease) $ $361,206,909 Withdrawals & distributions $ ($363,300,436) Ending capital account $ $2,390,229 □ Tax basis □ GAAP □ Sect 704(b) book □ Other (explain) Sect 704(b) book Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 $361,776,890 Net rental real estate income (loss) 2 Other net rental income (loss) 3 Guaranteed payments 4 Interest income 5 $32,507 Ordinary dividends 6a 6b Qualified dividends Royalties 7 Net short-term capital gain (loss) 8 Net long-term capital gain (loss) 9a 9b Collectibles (28%) gain (loss)
Carlton Asset Management
9c 10 11 12 13 14 15 16 Unrecaptured section 1250 gain Net section 1231 gain (loss) Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions
66-0000003
$38,565 A $36,677,780 C $325,099,110 A Japan B $9,104,277 D $9,104,277 L $562,934 C $989 A $363,300,436 A $32,507
17 18 19 20
Alternative minimum tax (AMT) items Tax-exempt income & nondeductible expense Distributions Other Information
Carlton Asset Management
66-0000003
Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 □ Amended K-1 □ Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000003 Partnership's name, address, city, state, and Zip B Carlton Asset code Management Lp 1678 S Hoover Blvd San Francisco, CA 94101 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D X Tax shelter registration number, if any E Check if Form 8271 is attached F Part II Information About the Partner Partner's Identification number G 001-06-0006 Partner's name, address, city, state and ZIP code H Tony Carlton 4819 S 1900 W San Francisco, CA 94101 □ General partner or LLC member-manager I Limited partner or other □ Limited partner or other LLC member LLC member □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Individual Partner’s share of profit, loss and capital L Beginning% Ending% Profit 1 1 Loss 1 1 Capital 1 1 Partner’s share of liabilities at year end: M Nonrecourse $ $5,400 Qualified nonrecourse financing $ Recourse $ Partner’s capital account analysis: N Beginning capital account $ $50,379 Capital contributed during the year $ Current year increase (decrease) $ $4,058,505 Withdrawals & distributions $ ($4,082,027) Ending capital account $ $26,857 □ Tax basis □ GAAP □ Sect 704(b) book □ Other (explain) Sect 704(b) book Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 $4,064,909 Net rental real estate income (loss) 2 Other net rental income (loss) 3 Guaranteed payments 4 Interest income 5 $365 Ordinary dividends 6a 6b Qualified dividends Royalties 7 Net short-term capital gain (loss) 8
Carlton Asset Management
9a 9b 9c 10 11 12 13 14 15 16 Net long-term capital gain (loss) Collectibles (28%) gain (loss) Unrecaptured section 1250 gain Net section 1231 gain (loss) Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions
66-0000003
$433 A $412,110 C $3,652,799 A Japan B $102,295 D $102,295 L $6,325 C $11 A $4,082,027 A $365
17 18 19 20
Alternative minimum tax (AMT) items Tax-exempt income & nondeductible expense Distributions Other Information
Eastlands Quarries
TEST SCENARIO 4 FORMS REQUIRED: 1065, 4562, 4797, 8308,1065 Sch D, 1065 Sch K-1 (3), Form 8453-PE, DEPENDENCIES ATTACHMENTS:
Other Income (Loss) Statement
66-0000004
Itemized Other Deductions Statement
Itemized Section 263A Costs Schedule Inventoriable Costs Paid Schedule Section 754 Election Partnership’s Charitable Contributions Statement Other AMT Items Statement Schedule L Other Current Assets Statement Schedule L Other Assets Statement Schedule L Other Current Liabilities Statement
BINARY ATTACHMENTS: Scanned Form 8453-PE (8453 Signature Document) HEADER INFO: Tax Period: Calendar Year 2006 Preparer Firm Electronic Tax Filers, Inc 1065 Efile Drive Anytown, OR 97201 66-0000004
MultipleSoftwarePackagesUsed: Yes or No Originator: EFIN: Self-select Type: ERO PractionerPIN: None PIN Entered by – N/A
Signature Option: Binary Attachment 8453 Signature Document Return Type: 1065 Filer: EIN: 66-0000001 Name: Eastlands Quarries Name Control: EAST Address: 2313 Jackson Ave Portland, OR 97208 Name: Jonathan Teak Title: President Taxpayer PIN: Phone: 555-555-5555 Email Address: Anymail@email.com DateSigned: 04/11/2006 Name: John Smith SSN: 154-10-0001 Phone: 555-555-5555 Email Address: Anymail@email.com Date Prepared: 04/11/2006 Self Employed: No N/A
Partner:
Preparer:
IRS PAYMENT:
Eastlands Quarries
Details for attachments to Form Attachment 1, Form 1065, Page 1, Line 7 (Other Income (Loss) Statement)
Miscellaneous 36,522
66-0000004
Attachment 2, Form 1065, Page 1 Line 20 (Itemized Other Deductions Statement)
Amortization Insurance Professional Fees Miscellaneous 441,924 75,606 583,204 213,470
Attachment 3, Form 1065, Page 2, Schedule A, Line 4 (Itemized Section 263A Costs Schedule)
Rent Utilities 50,000 24,212
Attachment 4, Form 1065, Page 2, Schedule A, Line 5 (Inventoriable Costs Paid Schedule)
Professional Fees Utilities Miscellaneous Cost of Goods Sold 19,360 1,321,610 225,142 1,552,601
Attachment 5, Form 1065, Page 2, Schedule B, Line 11 (Section 754 Election)
Name of Partnership Partnership Address Section 754 Declaration Eastlands Quarries 2313 Jackson Portland, OR 97208 Made a section 754 declaration
Attachment 6, Form 1065, Page 3, Schedule K, Line 13a (Partnership’s Charitable Contributions Statement)
Type of Contribution Amount 50% Cash Contribution 3,000
Attachment 7, Form 1065, Page 3, Schedule K, Line 17f (Other AMT Items Statement)
Stream (Length: 100,000 Characters) This is where you place your other AMT items information.
Attachment 8, Form 1065, Page 4, Schedule L, Line 6b and 6d (Schedule L Other Current Assets Statement)
Type Prepaid Insurance Deposit BOY Amount 105,000 45,000 EOY Amount 105,000 20,000
Attachment 9, Form 1065, Page 4, Schedule L, Line 13b and 13d (Schedule L Other Assets Statement)
Type Other Assets BOY Amount 387,000 EOY Amount 411,000
Eastlands Quarries
66-0000004
Attachment 10, Form 1065, Page 4, Schedule L, Line 17b and 17d (Schedule L Other Current Liabilities Statement)
Type Accrued Payroll Accrued Profit Sharing BOY Amount 793,542 377,622 EOY Amount 801,250 486,135
Eastlands Quarries
66-0000004
Form 1065 Test U.S. Return of Partnership Income Tax 2006 Calendar Year 2006 or tax year beginning , 2006, ending , 2006 Principal business activity A Quarries Principal product or service B Crushed Stone Business code number C 66-0000004 Name and Address: Eastlands Quarries 2313 Jackson Portland, OR 97208 Employer Identification number: D 212310 Date business started E 03/29/2002 Total assets F 28,234,548 Check applicable boxes 1,2,3,4,5 G Check accounting method 1,2,3 H 2 Check if Schedule M-3 Required (attach J Schedule M-3) Number of Schedule K-1 I 3 Line Description Line Amount Write-in / Literal / Attachment Gross receipts or sales 1a $15,200,800 Less returns and allowances 1b $115,470 Balance 1c $15,085,330 Cost of goods sold (Sch A, line 8) 2 $7,000,000 Gross profit. Subtract line 2 from 1c 3 $8,085,330 Ordinary income or (loss) 4 Net farm profit (loss) F1040 5 Net gain (loss) F4797 6 $37,400 Other income or (loss) 7 $36,522 Attachment 1 Total income. Add lines 3 through 10 8 $8,159,252 Salaries and wages (less employment 9 credits) $550,000 Guaranteed payments to partners 10 Repairs and maintenance 11 $3,120,512 Bad debts 12 $11,411 Rent 13 $486,634 Taxes and licenses 14 $262,140 Interest 15 $38,106 Depreciation (attach Form 4562) 16a $1,552,601 Less depreciation claimed on Sch A 16b $1,552,601 Total depreciation 16c 0 Depletion 17 $653,121 Retirement plans, etc 18 $53,721 Employee benefit programs 19 $287,416 Other deductions 20 $1,314,204 Attachment 2 Total deductions (add lines 9 – 20) 21 $6,777,265 Ordinary business income (loss) (Subtract 22 Line 21 from Line 8 $1,381,987 Schedule A Cost of Goods Sold Inventory at beginning of year 1 $1,372,320 Purchases less cost of items 2 $1,512,263 Cost of labor 3 $2,130,412 Additional section 263A costs 4 $74,212 Attachment 3 Other costs 5 $3,118,713 Attachment 4 Total. Add lines 1 - 5 6 $8,207,920 Inventory at the end of year 7 $1,207,920 Cost of goods sold. Subtract Line 7 from 8 $7,000,000 6 9a (i) Cost in regulations 1.471-3 Lower of cost or market 9a (ii) X
Eastlands Quarries
Form 1065 Test U.S. Return of Partnership Income Tax Other 9a (iii) Check if writedown 9b Check if the LIFO was adopted 9c Section 263A rules apply … 9d Yes Change in determining quantities, cost, 9e No valuations Schedule B Other Information Domestic general partnership 1a Domestic limited partnership 1b Domestic limited liability company 1c X Domestic limited liability partnership 1d Foreign partnership 1e Other 1f Any partners in this partnership also 2 No partnerships? Partnership own interest in another 3 No partnership or foreign entity? Partnership file Form 8893? 4 No Partnership total receipts <$250,000 5a No Partnership total assets <$600,000 5b No Filed Schedule K-1 with return? 5c No Partnership have foreign partners? 6 No Partnership publicly traded partnership? 7 No Partnership filed F8264? 8 No Partnership have an interest in or a 9 No signature, or other authority over financial account in foreign country? Partnership receive distribution from, 10 No granter of, transferor to foreign trust? Distribution of property or transfer of 11 Yes partnership interest? Number of Forms 8865 attached 12 Name of designated TMP Identifying number of TMP Address of designated TMP Schedule K Partners’ Distributive Share Items Ordinary business income (loss) 1 $1,381,987 Net rental real estate income (loss) 2 Other gross rental income (loss) 3a Other rental activities expenses 3b Other net rental income (loss) Subtract 3c Line 3b from 3a Guaranteed payments 4 Interest Income 5 $14,225 Ordinary dividends 6a Qualified dividends 6b Royalties 7 Net short-term capital gain (loss) 8 $2,300 Net long-term capital gain (loss) 9a $ (2500) Collectibles (28%) gain (loss) 9b Unrecaptured section 1250 gain 9c Net section 1231 gain (loss) 10 $ (56,500) Other income (loss) 11 Section 179 deduction 12 Contributions 13a $3,000 Investment interest expenses 13b
66-0000004
2006
Attachment 5
Attachment 6
Eastlands Quarries
Form 1065 Test U.S. Return of Partnership Income Tax Section 59(e)(2) expenditures (type) 13c Section 59(e)(2) expenditures (amount) 13c (2) Other deductions 13d Net earnings (loss) self employment 14a $1,344,587 Gross farming or fishing income 14b Gross nonfarm income 14c $13,856,213 Low-income housing credit 42(j)(5) 15a Low-income housing credit (other) 15b Qualified rehabilitation expenditures 15c Other rental real estate credits 15d Other rental credits 15e Other credits and credit recapture 15f Name of country or U.S. possession 16a Gross income from all sources 16b Gross income sourced at 16c partnership level Passive 16d Listed categories 16e General limitation 16f Interest expense 16g Other 16h Passive 16i Listed categories 16j General limitation 16k Total foreign taxes Paid □ Accrued □ 16l Reduction in taxes available for credit 16m Other foreign tax information 16n Post 1986 depreciation adjustment 17a $ (199,426) Adjusted gain or loss 17b $ (15,622) Depletion (other than oil and gas) 17c $619,783 Oil, gas, and geothermal properties-gross 17d income Oil, gas, and geothermal properties17e deductions Other AMT items 17f $ (22,101) Tax-exempt interest income 18a Other tax-exempt income 18b Nondeductible expenses 18c Distri of cash & marketable securities 19a $1,900,000 Distributions of other property 19b Investment income 20a $14,225 Investment expenses 20b Other items and amounts 20c
66-0000004
2006
Attachment 7
Eastlands Quarries
66-0000004
Analysis of Net Income (Loss) Net income (loss) Combine SchK line 1 – $1,336,512 11; Subtract sum SchK line 12 - 13d, and 16l (i) Corporate (ii) (iii) (iv) Partnership (v) Exempt Individual Individual organization (active) (passive) Analysis 2a $735,082 by General partners Analysis 2b $601,430 by Limited partners Schedule L Balance Sheets per Books Beginning of tax year End of tax year 1 1 2a 2b 3 4 5 6 7 8 9a 9b 10a 10b 11 12a 12b 13 14 15 16 17 18 19 Assets Cash Trade notes Less allowance Inventories U.S. govt oblig Tax-exempt securities Other current assets Mortgage & real estate loan Other investments Bldgs & other deprec assets Less accumulated deprec Depletable assts Less accumulated depletion Land Intangible assets Less accum amortization Other assets Total assets Liabilities Accounts payable Mortgages, notes, bonds payable < 1yr Other current liabilities All nonrecourse loans Mortgages, (a) $1,140,165 $1,140,165 $1,372,320 (b) $375,120 (c) $1,353,242 $1,353,242 $1,207,920 (d) $1,530,820
(vi) Nominee Other
Write-in / Literal
$150,000
$125,000
Attachment 8
$9,327,811 $1,426,314 $7,246,187 $246,187 $7,926,216 $7,926,216 $387,000 $26,999,318 (a) (b) $1,000,000 $7,901,497 $7,000,000 $747,000
$9,526,741 $1,523,300 $7,312,547 $375,638 $7,926,216 $7,926,216 $411,000 $28,234,548 (c) (d) $1,200,000 Attachment 9 $8,006,441 $6,936,909 $737,000
$1,171,164
$1,287,385
Attachment 10
$3,000,000
$2,500,000
Eastlands Quarries
66-0000004
notes, bonds payable > 1yr Other liabilities 20 Partners’ capital 21 accounts $21,828,154 $23,247,163 Total labilities 22 and capital $26,999,318 $28,234,548 Schedule M-1 Reconciliation of Income (Loss) per Books With Income per Return Line Description Line Amount Write-in / Literal Net Income (loss) per books 1 $3,319,009 Income included on SchK lines 1, 2, 3c, 5, 2 6a, 7, 8, 9a, 10, 11, not recorded on the books this year (itemized): Total Income Included 2 Guaranteed payments (other than health 3 insurance) Expenses recorded on books (itemize) 4a Depreciation Travel & entertainment 4b $12,000 Total Income Expenses 4 Add lines 1 – 4 5 $3,331,009 Income recorded on books (itemize) tax6a exempt interest-depreciation Deductions not charged against book 7a (itemize) depreciation $1,487,612 Deductions not charged against book 7a (itemize)-depletion $506,885 Total Itemized Deductions 7 Total Income/Deductions 8 Add lines 6 and 7 8 $1,994,497 Income (loss) (Analysis of net income 9 (loss) line 1). Subtract line 8 from line 5 $1,336,512 Schedule M-2 Analysis of Partners’ Capital Accounts Balance at beginning of year 1 $21,828,154 Capital contributed - Cash 2a Capital contributed - Property 2b Net income (loss) per books 3 $3,319,009 Other increases (itemized) 4 Add lines 1 through 4 5 $25,147,163 Distributions – Cash 6a $1,900,000 Distributions – Property 6b Other decreases (itemized) 7 Add lines 6 and 7 8 $1,900,000 Balance at end of year. Subtract line 8 9 from line 5 $23,247,163
Eastlands Quarries
66-0000004
Form 4562 Depreciation and Amortization 2006 Name: Eastland Quarry Business or Activity: Quarries EIN: 66-0000004 Line Description Line Amount Write-in / Literal / Attachments Part I Election to Expense Certain Property Under Section 179 Maximum amount 105,000 1 Total cost of section 179 prop 2 Threshold cost of section 179 prop 420,000 3 Reduction in limitation 4 Dollar limitation for TY 5 Description of Property 6(a) Cost 6(b) Elected cost 6(c) Listed property 7 Total elected cost of sec 179 prop 8 Tentative deduction 9 Carryover of disallowed deduction 10 Business income limitation 11 Section 179 expense deduction 12 Carryover of disallowed deduction 13 Part II Special Depreciation Allowance and Other Depreciation Special depreciation allowed 14 182,157 Property subject to sec 168(f)(1) election 15 Other depreciation 16 Part III MACRS Depreciation - Section A 17 MACRS deductions 1,370,000 Sec 168(i)(4) election 18 Section B – Assets Placed in Service During 2006 Tax Year Using the General Depreciation System (a) (b) (c) (d) (e) (f) (g) Classification of Month Basis for ConMethod Deprc property & Year deprec Recovery vention deduct period 19a 19b 19c 19d 19e 19f 19g 19h 3-year property 5-year property 7-year property 10-year property 15-year property 20-year property 25-year property Residential rental property (a) Classification of property 55,260 322,560 5 Yrs 7 Yrs HY HY 200DB 200DB 11,052 46,062
Write-in / Literal / Attachments
MM (b) Month & Year (c) Basis for deprec (d) Recovery period (e) Convention
S/L S/L (f) Method (g) Deprc deduct Write-in / Literal / Attachments
Nonresidential real MM S/L property Section C – Assets Placed in Service During 2006 Tax Year Using the Alternative Depreciation System Class life 20a 12-year S/L 20b 40-year MM S/L 20c 19i
Eastlands Quarries
Form 4562 Depreciation and Amortization 2006 Part IV Summary Listed property 21 12,630 Total 22 1,552,601 Assets for CY 23 Part V Listed Property Section A – Depreciation and Other Information Evidence? 24a Yes is checked Evidence written? 24b Yes is checked Special depreciation allowance 25 Property used more than 50% in a qualified business use: 26 (a) (b) (c) (d) (e) (f) Date placed Busines Cost or Basis Reco Type of in service s/invest other for very Property ment basis deprici Perio use % ation d 2006 Envoy 02/16/2006 100 42,600 42,600 5 Yrs 2006 Honda Civic SI 01/01/2006 100 20,550 20,550 5 Yrs Property used 50% or less in a qualified business use: 27
66-0000004
(g) Method convention 200 DB/HY 200 DB/HY
(h) Depreci ation deducti on 8,520 4,110
(i) Elected section 179 cost
Add column (h), lines 25 - 27 28 Add column (i), line 26 29 Section B – Information on Use of Vehicles 30(a) Total bus/invest miles driven 31(a) Total commuting miles driven 32(a) Tot other personal miles driven 33(a) Total miles driven Vehicle available for personal use? 34 Vehicle used > 5% ? 35 Another vehicle avail for personal use? 36 Section C – Questions for Employers Who Provide Vehicles for Use by Their Employees Maint written policy prohibits commu? 37 Yes is checked Maint written policy prohibits pers use 38 Yes is checked Vehicles treated as personal use? 39 Yes is checked Provide > 5 vehicle? 40 Yes is checked Qualified auto demonstration use? 41 No is checked Part VI Amortization (a) (b) (c) (d) (e) (f) Depreciation Date amort Amort Code Amort Amort of costs begins amount section period or for this percent Yr 42 amortization of costs that begin during your 2006 tax year Development 06/30/2006 104,106 291 Cost Amort of costs 43 before 2006 TY Total 44 5 Yrs 10,411 431,513 441,924
12,630
Write-in / Literal / Attachments
Eastlands Quarries
Form 4797 Sales of Business Property Name: Eastland Quarry EIN: 66-0000004 Line Description Line Amount Gross receipts fm sales or exchg 1 Part I Sales or Exchanges of Property Used in a Trade or Business Line Description Line Amount Description of Date Date Gross sale property acquired sold price (a) (b) (c) (d) 2 Stone Crusher 01/01/04 06/30/05 162,372 Line Amount
66-0000004
2006
Write-in / Literal / Attachments
Write-in / Literal / Attachments Depreciation Cost or Gain or allowed other loss (e) basis (g) (f) 37,128 260,000 (60,500) Write-in / Literal / Attachments
3 4 5 6 7 8 9 Part II
Line Description Gain fm F4684 Sec 1231 gain fm F6252 Sec 1231 gain fm F8824 Gain fm casualty or theft Combine lines 2 to 6 Nonrecaptured net sec 1231 loss Subtract line 8 from line 7 Ordinary Gains and Losses Line Description Description of Date property acquired (a) (b)
4,000 (56,500)
Date sold (c)
Line Amount Gross sale price (d)
Write-in / Literal / Attachments Depreciation Cost or Gain or allowed other loss (e) basis (g) (f)
10
Ordinary gains and loses not included on lines 11 through 16
11 12 13 14 15 16 17 18a 18b Part III
19a 19b 19c 19d 20 21 22 23 24
Line Description Line Amount Write-in / Literal / Attachments Loss fm line 7 Gain fm line 7 Gain fm line 31 37,400 Net gain F4684 Ordinary gain F6252 Ordinary gain F8824 Combine lines 10 to16 37,400 Part of loss F4684 Redetermined gain or (loss) on line 17 Gain for Disposition of Property Under Sections 1245, 1250, 1252, 1254 and 1255 Description of property Date Date sold (a) acquired (c) (b) Machinery & Equipment Various Various Machinery & Equipment Various Various
Gross Sale price Cost or other basis Depreciation allowed Adjusted basis Total gain
Property A 70,000 82,000 44,000 38,000 32,000
Property B 13,000 9,000 5,400 3,600 9,400
Property C
Property D
Eastlands Quarries
66-0000004
Form 4797 Sales of Business Property 2006 Depreciation allowed 25a 44,000 5,400 Smaller of lines 24 and 25b 32,000 5,400 25a Additional 26a depreciation after 1975 Applicable % 26b Subtract line 26a from 26c line 24 Additional 26d depreciation after 1969 Smaller of lines 26c 26e and 26c Sec 291 amount 26f Add lines 26b,26e and 26g 26f Soil, water, land 27a Line 27 multiplied by 27b applicable % Smaller of lines 24 and 27c 27b Intangible drilling 28a Smaller of lines 24 and 28b 28a Applicable % of 29a payment excluded Smaller of lines 24 and 29b 29a Line Description Line Amount Write-in / Literal / Attachments Total gain all property 30 41,400 Add property columns A – D 31 37,400 Subtract line 31 from line 30 32 4,000 Part IV Recapture Amounts Under Sections 179 and 280F(b)(2) (a) Section 179 (b) Section 280F(b)(2) Sec 179 expense deduction or depreciation 33 Recomputed depreciation 34 Recapture amount 35
Eastlands Quarries
Report of a Sale or Exchange of Certain Partnership Interests Name of Partnership: Eastland Quarry Telephone number: 555-555-5555 Employer identification number: 66-0000004 Number, street, and room or suite: 2313 Jackson Portland, OR 97208 Part I - Transferor Information Name: Peter Teak Identifying number: 001-06-0007 Number and street: 34 West Washington Ave City or town: Salt Lake City UT 84100 Part II - Transferor Information Name: Joseph Spruce Identifying number: 154-00-0003 Number and street: 5421 North 2100 South City or town: San Jose, CA 95101 Part III - Date of Sale or Exchange of Partnership Interest: 07/01/2006 Sch D (1065) Test 1 Capital Gains and Losses Name: Eastland Quarry EIN: 66-0000004 Part I Short-Term Capital Gains & Losses Description of property Date Date acquired sold (a) (b) (c) 1 100 Shares ABC 04/01/2006 09/30/2006 Form 8308
66-0000004
2006
2006
Sale price (d) 5,000
Cost or other basis (e) 2,700
Gain or loss (f) 2,300
2 3 4 5 Part II
6
Line Description Short-term capital gain from installment sales (F6252) Short-term capital gain from like-kind exchgs (F8824) Partnership share of net short-term capital gain (loss) Net short-term capital gain or loss. Combine lines 1- 4 Long-Term Capital Gains & Losses Description of property Date Date Acquired sold (a) (b) (c) 1 Acre of Land 08/01/2003 01/21/2006 Line Description Long-term capital gain (loss) from installment sales F6252, line 26 or 37 Long-term capital gain (loss) from like-kind exchanges from F8824 Partnership share of net long-term capital gain (loss) Capital gain distributions Net long-term capital gain or loss. Combine lines 6-10
Line Amount
Write-in/Literal
2,300 Sale price (d) 7,500 Line Amount Cost or other basis (e) 10,000 see statement Write-in/Literal Gain or loss (f) (2,500)
7 8 9 10 11
(2500)
Eastlands Quarries
66-0000004
Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 Amended K -1 Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000004 Partnership's name, address, city, state, and B Eastland Quarry Zip code 2313 Jackson Portland, OR 97208 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D Tax shelter registration number, if any E Check if Form 8271 is attached F Part II Information About the Partner Partner's Identification number G 001-06-0008 Partner's name, address, city, state and ZIP H Jonathan Teak code 48 Adams Avenue Portland, OR 97208 □ General partner or LLC member-manager I General partner or □ Limited partner or other LLC member LLC member-manager □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Individual Partner’s share of profit, loss and capital L Beginning % Ending% Profit 55 55 Loss 55 55 Capital 55 55 Partner’s share of liabilities at year end: M Nonrecourse $ Qualified nonrecourse financing $ Recourse $ 2,500,000 Partner’s capital account analysis: N Beginning capital account $ 12,005,484 Capital contributed during the year $ Current year increase (decrease) $ 1,825,455 Withdrawals & distributions $ (1,045,000) Ending capital account $ 12,785,939 □ Tax basis □ GAAP □ Sect 704(b) book Section 704(b) book is □ Other (explain) checked Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 760,093 Net rental real estate income (loss) 2 Other net rental income (loss) 3 Guaranteed payments 4 Interest income 5 7,824 6a Ordinary dividends 6b Qualified dividends Royalties 7 Net short-term capital gain (loss) 8 1,265 9a Net long-term capital gain (loss) (1,375) 9b Collectibles (28%) gain (loss) Unrecaptured section 1250 gain 9c 10 Net section 1231 gain (loss) (3,175)
Eastlands Quarries
11 12 13 14 15 16 17 Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions Alternative minimum tax (AMT) items
66-0000004
(a) 1,650 (a) 406,738 (c) 762,917 (a) (109,684) (b) (8,592) (c) 340,881 (f) (12,156) (a) 1,045,000 (a) 7,824
18 19 20
Tax-exempt income & nondeductible expense Distributions Other Information
Eastlands Quarries
66-0000004
Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 Amended K -1 Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000004 Partnership's name, address, city, state, and Zip B Eastland Quarry code 2313 Jackson Portland, OR 97208 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D Tax shelter registration number, if any E Check if Form 8271 is attached F Part II Information About the Partner Partner's Identification number G 001-06-0007 Partner's name, address, city, state and ZIP code H Peter Teak 34 West Wash. Ave. Salt Lake City, UT 84100 □ General partner or LLC member-manager I Limited partner or other □ Limited partner or other LLC member LLC member □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Individual Partner’s share of profit, loss and capital L Beginning % Ending% Profit 45 0 Loss 45 0 Capital 45 0 Partner’s share of liabilities at year end: M Nonrecourse $ Qualified nonrecourse financing $ Recourse $ Partner’s capital account analysis: N Beginning capital account $ 9,822,670 Capital contributed during the year $ Current year increase (decrease) $ 746,777 Withdrawals & distributions $ Ending capital account $ 10,569,447 □ Tax basis □ GAAP □ Sect 704(b) book Section 704(b) book is □ Other (explain) checked Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 310,947 Net rental real estate income (loss) 2 Other net rental income (loss) 3 Guaranteed payments 4 Interest income 5 3,201 Ordinary dividends 6a 6b Qualified dividends Royalties 7 Net short-term capital gain (loss) 8 518 Net long-term capital gain (loss) 9a (563) 9b Collectibles (28%) gain (loss)
Eastlands Quarries
9c 10 11 12 13 14 15 16 17 Unrecaptured section 1250 gain Net section 1231 gain (loss) Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions Alternative minimum tax (AMT) items
66-0000004
(12,713) (a) 675 (a) 0 (c) 3,117,648 (a) (44,871) (b) (3,515) (c) 139,451 (f) (4,973) (a) 3,201
18 19 20
Tax-exempt income & nondeductible expense Distributions Other Information
Eastlands Quarries
66-0000004
Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 Amended K -1 Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000004 Partnership's name, address, city, state, and Zip B Eastland Quarry code 2313 Jackson Portland, OR 97208 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D Tax shelter registration number, if any E Check if Form 8271 is attached F Part II Information About the Partner Partner's Identification number G 001-06-0008 Partner's name, address, city, state and ZIP code H Joseph Spruce 5421 North 2100 South San Jose, CA 95101 □ General partner or LLC member-manager I Limited partner or other □ Limited partner or other LLC member LLC member □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Individual Partner’s share of profit, loss and capital L Beginning % Ending% Profit 0 45 Loss 0 45 Capital 0 45 Partner’s share of liabilities at year end: M Nonrecourse $ Qualified nonrecourse financing $ Recourse $ Partner’s capital account analysis: N Beginning capital account $ 10,569,447 Capital contributed during the year $ Current year increase (decrease) $ 746,777 Withdrawals & distributions $ (855,000) Ending capital account $ 10,461,224 □ Tax basis □ GAAP □ Sect 704(b) book Section 704(b) book is □ Other (explain) checked Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 310,947 Net rental real estate income (loss) 2 Other net rental income (loss) 3 Guaranteed payments 4 Interest income 5 3,200 Ordinary dividends 6a 6b Qualified dividends Royalties 7 Net short-term capital gain (loss) 8 517 Net long-term capital gain (loss) 9a (562) 9b Collectibles (28%) gain (loss)
Eastlands Quarries
9c 10 11 12 13 14 15 16 17 Unrecaptured section 1250 gain Net section 1231 gain (loss) Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions Alternative minimum tax (AMT) items
66-0000004
(12,712) (a) 675 (a) 0 (c) 3,117,648 (a) (44,871) (b) (3,515) (c) 139,451 (f) (4,972) (a) 855,000 (a) 3,200
18 19 20
Tax-exempt income & nondeductible expense Distributions Other Information
Shoebill LTD
TEST SCENARIO 5
66-0000005
FORMS REQUIRED: 1065, 4562 (2), 4797, 6252, 8825, 1065 SCH K-1 (4), Form 8453-PE, DEPENDENCIES ATTACHMENTS:
Ordinary Income (Loss) From Other Partnerships, Estates, and Trusts Statement Other Income (Loss) Statement Itemized Other Deductions Statement Ownership of Any Interest in Another Partnership or Foreign Entity Statement Schedule L Other Current Assets Statement Schedule L Other Current Liabilities Statement
BINARY ATTACHMENTS: Scanned Form 8453-PE (8453 Signature Document) HEADER INFO: Tax Period: 200612 Preparer Firm Electronic Tax Filers, Inc 1065 Efile Drive Anytown, NV 89501 66-0000005
MultipleSoftwarePackagesUsed: Yes or No Originator: EFIN: Self-select Type: Self-select PractionerPIN: None PIN Entered by – N/A
Signature Option: Binary Attachment 8453 Signature Document Return Type: 1065 Filer: EIN: 66-0000005 Name: Shoebill LTD Name Control: SHOE Address: 5551 Elliot Rd Salt Lake City, UT 84101 Name: David Boxwood Title: Chief Executive Officer Taxpayer PIN: N/A Phone: 555-555-5555 Email Address: Anymail@email.com Date Signed: 04/01/2006 Name: John Doe SSN: 155-10-0001 Phone: 555-555-5555 Email Address: Anymail@email.com Date Prepared: 04/15/2006 Self Employed: No N/A
Partner:
Preparer:
IRS PAYMENT:
Shoebill LTD
66-0000005
Details for attachments to Form Attachment 1, Form 1065, Page 1, Line 4 (Ordinary Income (Loss) From Other Partnerships, Estates, and Trusts Statement) Partnership, Estate or Trust Name Hummingbird Flies Address 275 W Coolidge Ave Boise, ID 83708 EIN 11-0000055 Trade or Business Activity Legal Services Amount $23,712
Attachment 2, Form 1065, Page 1, Line 7 (Other Income (Loss) Statement) Type Cancellation of Debt Income Professional Fees Bank Fees Amount $478,206 $1,500,000 $1,500,000
Attachment 3, Form 1065, Page 1, Line 20 (Itemized Other Deductions Statement) Type Insurance Permits Amount $5,000,000 $961,480
Attachment 4, Form 1065, Page 2, Schedule B, Question 3 (Ownership of Any Interest in Another Partnership or Foreign Entity Statement) Type of Entity Partnership Entity Name Thrush Company EIN 65-5000055 Country US
Attachment 5, Form 1065, Page 4, Schedule L, Line 6b and 6d (Schedule L Other Current Assets Statement) Type Prepaid Investment BOY Amount $22,700 $0 EOY Amount $24,300 $5,077,578
Attachment 6, Form 1065, Page 4, Schedule L, Line 17b and 17d (Schedule L Other Current Liabilities Statement) Type Accrued Bonus Accrued Payroll Deferred Revenue BOY Amount $1,500,000 $500,000 $5,530,250 EOY Amount $2,818,150 $640,000 $8,742,300
Shoebill LTD
66-0000005
Form 1065 Test U.S. Return of Partnership Income Tax 2006 Calendar Year 2006 or tax year beginning 01/01, 2006, ending 12/31, 2006 Principal business activity A Aircraft Leasing & Sales Principal product or service B Aircraft Business code number C 532400 Name and Address: Shoebill LTD 5551 Elliot Rd Salt Lake City, UT 84101 Employer Identification number: D 66-0000005 Date business started E 10/01/1968 Total assets F 71,419,054 Check applicable boxes 1,2,3,4,5 G Check accounting method 1,2,3 H 2 Number of Schedule K-1 I 4 Check if Schedule M-3 Required (attach J Schedule M-3) Line Description Line Amount Write-in / Literal / Attachment Gross receipts or sales 1a 43,785,214 Less returns and allowances 1b Balance 1c 43,785,214 Cost of goods sold (Sch A, line 8) 2 21,882,071 Gross profit. Subtract line 2 from 1c 3 21,903,143 Ordinary income or (loss) 4 23,712 Attachment 1 Net farm profit (loss) F1040 5 Net gain (loss) F4797 6 3,505,874 Other income or (loss) 7 478,206 Attachment 2 Total income. Add lines 3 through 10 8 25,910,935 Salaries and wages (less employment 9 credits) 804,722 Guaranteed payments to partners 10 Repairs and maintenance 11 17,239 Bad debts 12 2,571,330 Rent 13 900,022 Taxes and licenses 14 44,444 Interest 15 912,647 Depreciation (attach Form 4562) 16a 162,240 Less depreciation claimed on Sch A 16b Total depreciation 16c 162,240 Depletion 17 Retirement plans, etc 18 Employee benefit programs 19 Other deductions 20 8,961,480 Attachment 3 Total deductions (add lines 9 – 20) 21 14,374,124 Ordinary business income (loss) (Subtract 22 Line 21 from Line 8 11,536,811 Schedule A Cost of Goods Sold Inventory at beginning of year 1 27,126,200 Purchases less cost of items 2 12,960,400 Cost of labor 3 Additional section 263A costs 4 Other costs 5 Total. Add lines 1 - 5 6 40,086,600 Inventory at the end of year 7 18,204,529 Cost of goods sold. Subtract Line 7 from 8 21,882,071 6 9a (i) Cost in regulations 1.471-3 X Lower of cost or market 9a (ii)
Shoebill LTD
Form 1065 Test U.S. Return of Partnership Income Tax Other 9a (iii) Check if writedown 9b Check if the LIFO was adopted 9c Section 263A rules apply … 9d Yes is checked Change in determining quantities, cost, 9e No is checked valuations Schedule B Other Information Domestic general partnership 1a Domestic limited partnership 1b X Domestic limited liability company 1c Domestic limited liability partnership 1d Foreign partnership 1e Other 1f Any partners in this partnership also 2 Y partnerships? Partnership own interest in another 3 Y partnership or foreign entity? Partnership file Form 8893? 4 N Partnership total receipts <$250,000 5a Partnership total assets <$600,000 5b Filed Schedule K-1 with return? 5c Partnership have foreign partners? 6 N Partnership publicly traded partnership? 7 N Partnership filed F8264? 8 N Partnership have an interest in or a 9 N signature, or other authority over financial account in foreign country? Partnership receive distribution from, 10 N granter of, transferor to foreign trust? Distribution of property or transfer of 11 N partnership interest? Number of Forms 8865 attached 12 Name of designated TMP Identifying number of TMP Address of designated TMP Schedule K Partners’ Distributive Share Items Ordinary business income (loss) 1 11,536,811 Net rental real estate income (loss) 2 3,579,503 Other gross rental income (loss) 3a Other rental activities expenses 3b Other net rental income (loss) Subtract 3c Line 3b from 3a Guaranteed payments 4 Interest Income 5 1,771,604 Ordinary dividends 6a Qualified dividends 6b Royalties 7 Net short-term capital gain (loss) 8 Net long-term capital gain (loss) 9a Collectibles (28%) gain (loss) 9b Unrecaptured section 1250 gain 9c Net section 1231 gain (loss) 10 237,979 Other income (loss) 11 Section 179 deduction 12 Contributions 13a Investment interest expenses 13b
66-0000005
2006
Attachment 4
Shoebill LTD
Form 1065 Test U.S. Return of Partnership Income Tax Section 59(e)(2) expenditures (type) 13c Section 59(e)(2) expenditures (amount) 13c (2) Other deductions 13d Net earnings (loss) self employment 14a 2,007,034 Gross farming or fishing income 14b Gross nonfarm income 14c 41,777,480 Low-income housing credit 42(j)(5) 15a Low-income housing credit (other) 15b Qualified rehabilitation expenditures 15c Other rental real estate credits 15d Other rental credits 15e Other credits and credit recapture 15f Name of country or U.S. possession 16a Gross income from all sources 16b Gross income sourced at 16c partnership level Passive 16d Listed categories 16e General limitation 16f Interest expense 16g Other 16h Passive 16i Listed categories 16j General limitation 16k Total foreign taxes Paid □ Accrued □ 16l Reduction in taxes available for credit 16m Other foreign tax information 16n Post 1986 depreciation adjustment 17a 800,000 Adjusted gain or loss 17b Depletion (other than oil and gas) 17c Oil, gas, and geothermal properties-gross 17d income Oil, gas, and geothermal properties17e deductions Other AMT items 17f Tax-exempt interest income 18a Other tax-exempt income 18b 2,500,000 Nondeductible expenses 18c 56,403 Distri of cash & marketable securities 19a Distributions of other property 19b Investment income 20a 1,771,604 Investment expenses 20b Other items and amounts 20c
66-0000005
2006
Shoebill LTD
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Analysis of Net Income (Loss) Net income (loss) Combine SchK line 1 – 11; Subtract sum SchK line 12 - 13d, and 16l (i) Corporate (ii) (iii) Individual Individual (active) (passive) Analysis 2a 4,281,474 by General partners Analysis 2b 8,562,949 by Limited partners Schedule L Balance Sheets per Books Beginning of tax year 1 1 2a 2b 3 4 5 6 7 8 9a 9b 10a 10b 11 12a 12b 13 14 15 16 17 18 19 Assets Cash Trade notes Less allowance Inventories U.S. govt oblig Tax-exempt securities Other current assets Mortgage & real estate loan Other investments Bldgs & other deprec assets Less accumulated deprec Depletable assts Less accumulated depletion Land Intangible assets Less accum amortization Other assets Total assets Liabilities Accounts payable Mortgages, notes, bonds payable < 1yr Other current liabilities All nonrecourse loans Mortgages, (a) 4,999,222 809,111
17,125,897 (iv) Partnership (v) Exempt organization (vi) Nominee Other
4,281,474
End of tax year (c) 16,488,999 1,288,222 (d) 25,330 15,200,777 17,616,409
Write-in / Literal
(b) 700,440 4,190,111 25,800,428
22,700
5,100,278
Attachment 5
22,500,030 22,00,030 20,300,000
24,785,827 2,435,217 22,350,610
10,100,000
11,125,650
61,113,679 (a) (b) 3,100,377 (c)
71,419,054 (d) 3,987,240 20,317,292
75,30,250
12,200,450
Attachment 6
32,271,505
Shoebill LTD
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notes, bonds payable > 1yr Other liabilities 20 Partners’ capital 21 accounts 18,211,547 34,914,072 Total labilities 22 and capital 61,113,679 71,419,054 Schedule M-1 Reconciliation of Income (Loss) per Books With Income per Return Line Description Line Amount Write-in / Literal Net Income (loss) per books 1 16,202,525 Income included on SchK lines 1, 2, 3c, 5, 2 6a, 7, 8, 9a, 10, 11, not recorded on the books this year (itemized): Total Income Included 2 Guaranteed payments (other than health 3 insurance) Expenses recorded on books (itemize) 4a Depreciation 923,372 Travel & entertainment 4b Total Income Expenses 4 Add lines 1 – 4 5 17,125,897 Income recorded on books (itemize) tax6a exempt interest-depreciation Total Income Recorded 6 Deductions not charged against book 7a (itemize) depreciation Deductions not charged against book 7a (itemize)-depletion Total Itemized Deductions 7 Total Income/Deductions 8 Add lines 6 and 7 8 Income (loss) (Analysis of net income 9 (loss) line 1). Subtract line 8 from line 5 17,125,897 Schedule M-2 Analysis of Partners’ Capital Accounts Balance at beginning of year 1 18,211,547 Capital contributed - Cash 2a 500,000 Capital contributed - Property 2b Net income (loss) per books 3 16,202,525 Other increases (itemized) 4 Add lines 1 through 4 5 34,914,072 Distributions – Cash 6a Distributions – Property 6b Other decreases (itemized) 7 Add lines 6 and 7 8 Balance at end of year. Subtract line 8 9 from line 5 34,914,072
Shoebill LTD
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Form 4562 Depreciation and Amortization 2006 Name: Shoebill Unlimited Business or Activity: Aircraft Leasing EIN: 66-0000005 Line Description Line Amount Write-in / Literal / Attachments Part I Election to Expense Certain Property Under Section 179 Maximum amount 105,000 1 Total cost of section 179 prop 2 Threshold cost of section 179 prop 420,000 3 Reduction in limitation 4 Dollar limitation for TY 5 Description of Property 6(a) Cost 6(b) Elected cost 6(c) Listed property 7 Total elected cost of sec 179 prop 8 Tentative deduction 9 Carryover of disallowed deduction 10 Business income limitation 11 Section 179 expense deduction 12 Carryover of disallowed deduction 13 Part II Special Depreciation Allowance and Other Depreciation Special depreciation allowed 14 22,361 Property subject to sec 168(f)(1) electio 15 Other depreciation 16 Part III MACRS Depreciation - Section A 17 MACRS deductions 101,033 Sec 168(i)(4) election 18 Section B – Assets Placed in Service During 2006 Tax Year Using the General Depreciation System (a) (b) (c) (d) (e) (f) (g) Write-in / Classification of Month Basis for Recovery ConMethod Deprc Literal / property & Year deprec period vention deduct Attachments 19a 19b 19c 19d 19e 19f 19g 19h 3-year property 5-year property 7-year property 10-year property 15-year property 20-year property 25-year property Residential rental property (a) Classification of property 6,120 29,304 10,885 3 Yrs 5 Yrs 7 Yrs HY HY HY S/L 200 DB 200 DB 1,020 5,861 1,555
MM (b) Month & Year (c) Basis for deprec (d) Recovery period (e) Convention
S/L S/L (f) Method (g) Deprc deduct Write-in / Literal / Attachments
Nonresidential real 10/04 S/L 9,856 39 Yrs MM 253 property Section C – Assets Placed in Service During 2006 Tax Year Using the Alternative Depreciation System Class life 20a 12-year S/L 20b 40-year MM S/L 20c Part IV Summary 19i
Shoebill LTD
Form 4562 Depreciation and Amortization 2006 Listed property 21 Total 22 132,083 Assets for CY 23 Part V Listed Property Section A – Depreciation and Other Information Evidence? 24a Yes is checked Evidence written? 24b Yes is checked Special depreciation allowance 25 Property used more than 50% in a qualified business use: 26 (a) (b) (c) (d) (e) (f) Date placed Busines Cost or Basis Recovery Type of in service s/invest other for Period Property ment basis deprici use % ation
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(g) Method convent ion
(h) Depreci ation deducti on
(i) Elected section 179 cost
27
Property used 50% or less in a qualified business use:
Add column (h), lines 25 - 27 28 Add column (i), line 26 29 Section B – Information on Use of Vehicles 30(a) Total bus/invest miles driven 31(a) Total commuting miles driven 32(a) Tot other personal miles driven 33(a) Total miles driven Vehicle available for personal use? 34 Vehicle used > 5% ? 35 Another vehicle avail for personal use? 36 Section C – Questions for Employers Who Provide Vehicles for Use by Their Employees Maint written policy prohibits commu? 37 Maint written policy prohibits pers use 38 Vehicles treated as personal use? 39 Provide > 5 vehicle? 40 Qualified auto demonstration use? 41 Part VI Amortization (a) (b) (c) (d) (e) (f) Depreciation Date amort Amort Code Amort Amort of costs begins amount section period or for this percent Yr 42 amortization of costs that begin during your 2006 tax year Development Cost Amort of costs 43 before 2006 TY Total 44
Write-in / Literal / Attachments
Shoebill LTD
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Form 4562 Depreciation and Amortization 2006 Name: Shoebill Unlimited Business or Activity: Aircraft Leasing EIN: 66-0000005 Line Description Line Amount Write-in / Literal / Attachments Part I Election to Expense Certain Property Under Section 179 Maximum amount 105,000 1 Total cost of section 179 prop 2 Threshold cost of section 179 prop 420,000 3 Reduction in limitation 4 Dollar limitation for TY 5 Description of Property 6(a) Cost 6(b) Elected cost 6(c) Listed property 7 Total elected cost of sec 179 prop 8 Tentative deduction 9 Carryover of disallowed deduction 10 Business income limitation 11 Section 179 expense deduction 12 Carryover of disallowed deduction 13 Part II Special Depreciation Allowance and Other Depreciation Special depreciation allowed 14 Property subject to sec 168(f)(1) election 15 Other depreciation 16 Part III MACRS Depreciation 17 MACRS deductions 4,983,216 Sec 168(i)(4) election 18 Section B – Assets Placed in Service During 2006 Tax Year Using the General Depreciation System (a) (b) (c) (d) (e) (f) (g) Classification of Month Basis for Recovery ConMethod Deprc property & Year deprec period vention deduct 19a 19b 19c 19d 19e 19f 19g 19h 3-year property 5-year property 7-year property 10-year property 15-year property 20-year property 25-year property Residential rental property (a) Classification of property
Write-in / Literal / Attachments
2,642,388
5 Yrs
HY
200DB
528,478
MM (b) Month & Year (c) Basis for deprec (d) Recovery period (e) Convention
S/L S/L (f) Method (g) Deprc deduct Write-in / Literal / Attachments
Nonresidential real MM S/L property Section C – Assets Placed in Service During 2006 Tax Year Using the Alternative Depreciation System Class life 20a 2,935,176 VARIES HY S/L 244,500 12-year S/L 20b 40-year MM S/L 20c Part IV Summary 19i
Shoebill LTD
Form 4562 Depreciation and Amortization 2006 Listed property 21 Total 22 5,756,194 Assets for CY 23 Part V Listed Property Section A – Depreciation and Other Information Evidence? 24a Yes is checked Evidence written? 24b Yes is checked Special depreciation allowance 25 Property used more than 50% in a qualified business use: 26 (a) (b) (c) (d) (e) (f) Type of Date placed Busines Cost or Basis Reco Property in service s/invest other for very ment basis deprici Perio use % ation d
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(g) Method convention
(h) Depreci ation deducti on
(i) Elected section 179 cost
27
Property used 50% or less in a qualified business use:
Add column (h), lines 25 - 27 28 Add column (i), line 26 29 Section B – Information on Use of Vehicles 30(a) Total bus/invest miles driven 31(a) Total commuting miles driven 32(a) Tot other personal miles driven 33(a) Total miles driven Vehicle available for personal use? 34 Vehicle used > 5% ? 35 Another vehicle avail for personal use? 36 Section C – Questions for Employers Who Provide Vehicles for Use by Their Employees Maint written policy prohibits commu? 37 Maint written policy prohibits pers use 38 Vehicles treated as personal use? 39 Provide > 5 vehicle? 40 Qualified auto demonstration use? 41 Part VI Amortization (f)Amort (a)Depreciati (c) Amort (d)Code (e)Amort for this on of costs amount section period or Yr (b)Date amort begins percent 42 amortization of costs that begin during your 2006 tax year Development Cost Amort of costs 43 before 2006 TY Total 44
Write-in / Literal / Attachments
Shoebill LTD
Form 4797 Sales of Business Property Name: Shoebill Unlimited EIN: 66-0000005 Line Description Line Amount Gross receipts fm sales or exchg 1 Part I Sales or Exchanges of Property Used in a Trade or Business Line Description Line Amount Description of Date Date Gross sale property acquired sold price (a) (b) (c) (d) 2 Line Description Gain fm F4684 Sec 1231 gain fm F6252 Sec 1231 gain fm F8824 Gain fm casualty or theft Combine lines 2 to 6 Nonrecaptured net sec 1231 loss Subtract line 8 from line 7 Ordinary Gains and Losses Line Description Description of Date property acquired (a) (b) Line Amount 237,979 2,550,000 2,787,979 2,787,979 Line Amount Gross sale price (d)
66-0000005
2006
Write-in / Literal / Attachments
Write-in / Literal / Attachments Depreciation Cost or Gain or allowed other loss (e) basis (g) (f)
Write-in / Literal / Attachments
3 4 5 6 7 8 9 Part II
Date sold (c)
Write-in / Literal / Attachments Depreciation Cost or Gain or allowed other loss (e) basis (g) (f) 567,895
10
Ordinary gains and loses not included on lines 11 through 16 Installment Sale from F6252
11 12 13 14 15 16 17 18a 18b Part III
19a 19b 19c 19d 20 21 22 23 24
Line Description Line Amount Write-in / Literal / Attachments Loss fm line 7 Gain fm line 7 2,787,979 Gain fm line 31 150,000 Net gain F4684 Ordinary gain F6252 Ordinary gain F8824 Combine lines 10 to16 3,505,874 Part of loss F4684 Redetermined gain or (loss) on line 17 Gain for Disposition of Property Under Sections 1245, 1250, 1252, 1254 and 1255 Description of property Date Date sold (a) acquired (c) (b) See F6252 04/30/04 06/30/05
Gross Sale price Cost or other basis Depreciation allowed Adjusted basis Total gain
Property A 3,150,000 600,000 150,000 450,000 2,700,000
Property B
Property C
Property D
Shoebill LTD
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Form 4797 Sales of Business Property 2006 Depreciation allowed 25a 150,000 Smaller of lines 24 and 25b 150,000 25a Additional 26a depreciation after 1975 Applicable % 26b Subtract line 26a from 26c line 24 Additional 26d depreciation after 1969 Smaller of lines 26c 26e and 26c Sec 291 amount 26f Add lines 26b,26e and 26g 26f Soil, water, land 27a Line 27 multiplied by 27b applicable % Smaller of lines 24 and 27c 27b Intangible drilling 28a Smaller of lines 24 and 28b 28a Applicable % of 29a payment excluded Smaller of lines 24 and 29b 29a Line Description Line Amount Write-in / Literal / Attachments Total gain all property 30 2,700,000 Add property columns A – D 31 150,000 Subtract line 31 from line 30 32 2,550,000 Part IV Recapture Amounts Under Sections 179 and 280F(b)(2) (a) Section 179 (b) Section 280F(b)(2) Sec 179 expense deduction or depreciation 33 Recomputed depreciation 34 Recapture amount 35
Form 6252 Installment Sale Income Name: Identifying number: 1 Description of property 2a Date acquired (month, day, year) 2b Date sold 3 Was property sold to a related party No 4 Was the property sold to a related party a marketable security Line Description Line Amount Part I Election to Expense Certain Property Under Section 179 Selling price including mortgages and other 5 debts. Mortgages, debts, and other liabilities buyer 6 assumed Subtract line 6 from line 5 7 Cost of other basis of property sold 8 Depreciation allowed or allowable 9
2006
□Yes
□No Write-in / Literal / Attachments
Shoebill LTD
Form 6252 Installment Sale Income Adjusted basis. Subtract line 9 from line 8. 10 Commissions and other expenses of sale 11 Income recapture from Form 4797, Part III 12 Add lines 10, 11, and 12 13 Subtract line 13 from line 5. If zero or less, 14 do not complete rest of form If property described on line 1you’re your 15 main home, enter amount of your excluded gain Gross profit. Subtract line 15 from line 14 16 Subtract line 13 from line 6. If zero or less 17 enter 0 Contract price. Add line 7 and line 17 18 Part II Installment Sale Income Gross profit percentage. Divide line 16 by 19 line 18. If this is the year of sale, enter the amount 20 from line 17. Otherwise 0 Payments received during year 21 Add lines 20 and 21 22 Payments received in prior years 23 Installment Sale income. Multiply line 22 24 by line 19 Enter the part of line 24 that is ordinary 25 income under the recapture rules Subtract lien 25 fro line 24. Enter here and 26 on Sch D or Form 4797 Part III Related Party Installment Sale Income Name, address and taxpayer identifying 27 number of related party Did related party resell or dispose of 28 property during this tax year If answer to 28 is ‘yes’, complete lines 30 29 through 37 unless one of the following conditions is met. Check box that applies The second disposition was more than 2 A years after the first disposition. If box is checked enter date of disposition The first disposition was a sale or exchange B of stock to the issuing corporation The second disposition was an involuntary C conversion and the threat of conversion occurred after the first disposition The second disposition occurred after the D death of the original seller or buyer It can be established to the satisfaction of E the IRS that tax avoidance was not a principal purpose for either dispositions Selling price of property sold by related 30 party Enter contract price from line 18 for year of 31 first sale Enter the smaller of line 30 or line 31 32 Total payments received by the end of your 33 2006 tax year Subtract line 33 from line 32. If zero or 34 less, enter 0 2006
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Shoebill LTD
Form 6252 Installment Sale Income Multiply line 34 by gross profit percentage 35 on line 19 for year of first sale Enter the part of line 35 that is ordinary 36 income under the recapture rules Subtract line 36 from line 35. Enter here on 37 Schedule D or Form 4797 2006
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Form 8825 Name: Shoebill Unlimited EIN: 66-0000005 1A 1B 1C 1D
Rental Real Estate Income and Expenses of a Partnership or an S Corporation
2006
Line Description Kind & location of each property
Line Amount / Information Aircraft
Write-in / Literal / Attachments
2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20a 20b(1) 20b(2) 21
Gross rents Advertising Auto and travel Cleaning and maintenance Commissions Insurance Legal and other professional fees Interest Repairs Taxes Utilities Wages and salaries Depreciation Other Total expense for each property Line Description Total gross rents Total expenses Net gain (loss) F4797 Net income (loss) from rental real estate activities Name EIN Net rental real estate income (loss)
A 6,575,640 4,230 7,135 21,300 155,940 38,342 406,581 3,220 5,704 7,311 126,211 5,726,037 6,502,011
Properties B
C
D
Line Amount / Information 6,575,640 (6,502,011) 3,505,874
Write-in / Literal / Attachments
3,579,503
Shoebill LTD
66-0000005
Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 Amended K -1 Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000005 Partnership's name, address, city, state, and B Shoebill Unlimited Zip code 5551 Elliot Road Salt Lake City, UT 84101 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D Tax shelter registration number, if any E Check if Form 8271 is attached F Part II Information About the Partner Partner's Identification number G 001-06-0009 Partner's name, address, city, state and ZIP H David Boxwood code 348 Nixon Circle Boise, ID 83708 □ General partner or LLC member-manager I General partner or LLC □ Limited partner or other LLC member member-manager □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Individual Partner’s share of profit, loss and capital L Beginning % Ending% Profit 25 25 Loss 25 25 Capital 25 25 Partner’s share of liabilities at year end: M Nonrecourse $ Qualified nonrecourse financing $ Recourse $ 20,317,292 Partner’s capital account analysis: N Beginning capital account $ 4,552,886 Capital contributed during the year $ 125,000 Current year increase (decrease) $ 4,050,631 Withdrawals & distributions $ Ending capital account $ 8,728,518 □ Tax basis □ GAAP □ Sect 704(b) book Section 704(b) book is □ Other (explain) checked Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 2,884,203 Net rental real estate income (loss) 2 894,876 Other net rental income (loss) 3 Guaranteed payments 4 Interest income 5 442,901 6a Ordinary dividends 6b Qualified dividends Royalties 7 Net short-term capital gain (loss) 8 9a Net long-term capital gain (loss) 9b Collectibles (28%) gain (loss) Unrecaptured section 1250 gain 9c
Shoebill LTD
10 11 12 13 14 15 16 17 18 19 20 Net section 1231 gain (loss) Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions Alternative minimum tax (AMT) items Tax-exempt income & nondeductible expense Distributions Other Information 59,495
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(a) 5,001,934 (c)10,444,370 (a) 200,000 (b) 625,000 (c) 14,101 (a) 442,901
Shoebill LTD
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Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 Amended K -1 Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification A 66-0000005 number Partnership's name, address, city, state, and B Shoebill Unlimited Zip code 5551 Elliot Road Salt Lake City, UT 84101 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D Tax shelter registration number, if any E Check if Form 8271 is attached F Part II Information About the Partner Partner's Identification number G 001-06-0010 Partner's name, address, city, state and ZIP H Joshua Plum code 2894 N. 6352 South Reno, NV 89510 □ General partner or LLC member-manager I Limited partner or other □ Limited partner or other LLC member LLC member □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Individual Partner’s share of profit, loss and capital L Beginning % Ending% Profit 25 25 Loss 25 25 Capital 25 25 Partner’s share of liabilities at year end: M Nonrecourse $ Qualified nonrecourse financing $ Recourse $ Partner’s capital account analysis: N Beginning capital account $ 4,552,887 Capital contributed during the year $ Current year increase (decrease) $ Withdrawals & distributions $ Ending capital account $ □ Tax basis □ GAAP □ Sect 704(b) book Section 704(b) book is □ Other (explain) checked Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 Net rental real estate income (loss) 2 Other net rental income (loss) 3 Guaranteed payments 4 Interest income 5 6a Ordinary dividends 6b Qualified dividends Royalties 7 Net short-term capital gain (loss) 8 9a Net long-term capital gain (loss)
Shoebill LTD
9b 9c 10 11 12 13 14 15 16 17 18 19 20 Collectibles (28%) gain (loss) Unrecaptured section 1250 gain Net section 1231 gain (loss) Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions Alternative minimum tax (AMT) items Tax-exempt income & nondeductible expense Distributions Other Information
66-0000005
(d) 0 (c)10,444,370 (a) 200,000
Shoebill LTD
66-0000005
Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 Amended K -1 Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000005 Partnership's name, address, city, state, and Zip B Shoebill Unlimited code 5551 Elliot Road Salt Lake City, UT 84101 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D Tax shelter registration number, if any E Check if Form 8271 is attached F Part II Information About the Partner Partner's Identification number G 001-06-0013 Partner's name, address, city, state and ZIP code H Tony Cypress 4810 South19 West San Francisco, CA 94104 □ General partner or LLC member-manager I Limited partner or other □ Limited partner or other LLC member LLC member □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Individual Partner’s share of profit, loss and capital L Beginning % Ending% Profit 25 25 Loss 25 25 Capital 25 25 Partner’s share of liabilities at year end: M Nonrecourse $ Qualified nonrecourse financing $ Recourse $ Partner’s capital account analysis: N Beginning capital account $ 4,552,887 Capital contributed during the year $ Current year increase (decrease) $ Withdrawals & distributions $ Ending capital account $ □ Tax basis □ GAAP □ Sect 704(b) book Section 704(b) book is □ Other (explain) checked Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 Net rental real estate income (loss) 2 Other net rental income (loss) 3 Guaranteed payments 4 Interest income 5 Ordinary dividends 6a 6b Qualified dividends Royalties 7 Net short-term capital gain (loss) 8 Net long-term capital gain (loss) 9a 9b Collectibles (28%) gain (loss)
Shoebill LTD
9c 10 11 12 13 14 15 16 17 18 19 20 Unrecaptured section 1250 gain Net section 1231 gain (loss) Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions Alternative minimum tax (AMT) items Tax-exempt income & nondeductible expense Distributions Other Information
66-0000005
(e) 0 (c)10,444,370 (a) 200,000 (b) 625,000
Shoebill LTD
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Sch K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. 2006 Tax year beginning January 1, 2006 ending December 31, 2006 Final K-1 Amended K -1 Part I Information About the Corporation Line Description Line Amount Write-in / Literal / Attachments Partnership's employer identification number A 66-0000005 Partnership's name, address, city, state, and Zip B Shoebill Unlimited code 5551 Elliot Road Salt Lake City, UT 84101 IRS Center where corporation filed return C Ogden Check if Publicly traded partnership (PTP) D Tax shelter registration number, if any E Check if Form 8271 is attached F Part II Information About the Partner Partner's Identification number G 11-0000054 Partner's name, address, city, state and ZIP code H Redbird Trees 7272 West Turman Ave Sacramento, CA 95813 □ General partner or LLC member-manager I Limited partner or other □ Limited partner or other LLC member LLC member-manager □ Domestic partner J □ Foreign partner Domestic partner What type of entity is this partner? K Partnership Partner’s share of profit, loss and capital L Beginning % Ending% Profit 25 25 Loss 25 25 Capital 25 25 Partner’s share of liabilities at year end: M Nonrecourse $ Qualified nonrecourse financing $ Recourse $ Partner’s capital account analysis: N Beginning capital account $ Capital contributed during the year $ Current year increase (decrease) $ Withdrawals & distributions $ Ending capital account $ □ Tax basis □ GAAP □ Sect 704(b) book Section 704(b) book is □ Other (explain) checked Part III Partner’s Share of Current Year Income, Deductions, Credits, and Other Items Line Description Write-in / Literal / Attachments Ordinary business income (loss) 1 Net rental real estate income (loss) 2 Other net rental income (loss) 3 Guaranteed payments 4 Interest income 5 Ordinary dividends 6a 6b Qualified dividends Royalties 7 Net short-term capital gain (loss) 8 Net long-term capital gain (loss) 9a 9b Collectibles (28%) gain (loss)
Shoebill LTD
9c 10 11 12 13 14 15 16 17 18 19 20 Unrecaptured section 1250 gain Net section 1231 gain (loss) Other income (loss) Section 179 deduction Other deductions Self-employment earnings (loss) Credits & credit recapture Foreign transactions Alternative minimum tax (AMT) items Tax-exempt income & nondeductible expense Distributions Other Information
66-0000005
(f) 0 (g) 10,444,370
ABC Oil and Gas L P
TEST SCENARIO 6
66-0000006
FORMS REQUIRED: 1065-B, 4797, 1065-B SCH K-1 (2), Form 8453-B, DEPENDENCIES ATTACHMENTS: Itemized Other Deductions Schedule Inventoriable Costs Paid Schedule Balance Sheets Discrepancy Statement Schedule L Other Current Assets Statement BINARY ATTACHMENTS: Scanned Form 8453-B (8453 Signature Document) HEADER INFO: Tax Period: Calendar Year 2006 Preparer Firm Electronic Tax Filers, Inc 1065 Efile Drive Anytown, TX 79001 66-0000006
MultipleSoftwarePackagesUsed: Yes or No Originator: EFIN: Self-select Type: Self-select PractionerPIN: None PIN Entered by – N/A
Signature Option: Binary Attachment 8453 Signature Document Return Type: 1065-B Filer: EIN: 66-0000006 Name: ABC Oil and Gas L P Name Control: ABCO Address: 28 Oil Rig Rd Anytown, TX 79001 Name: Jonathan Walker Title: Chief Executive Officer Taxpayer PIN: N/A Phone: 555-55-5555 Email Address: Anymail@email.com Date Signed: 04/01/2006 Name: Jane Doe SSN: 661-10-0001 Phone: 555-555-5555 Email Address: Anymail@email.com Date Prepared: 04/10/2006 Self Employed: No N/A
Partner:
Preparer:
IRS PAYMENT:
ABC Oil and Gas L P
66-0000006
Details for attachments to Form Attachment 1, Form 1065-B, Page 1, Line 23 (Itemized Other Deductions Schedule) Type Survey Costs Permits Professional Fees Bank Fees Amount $150,750 $27,250 $46,140 $2,600
Attachment 2, Form 1065-B, Page 2, Schedule A, Line 5 (Inventoriable Costs Paid Schedule) Type Other Costs Amount $576,000
Attachment 3, Form 1065-B, Page 5, Schedule L (Balance Sheets Discrepancy Statement) Describe Allocation of Depletion Expense Attachment 4, Form 1065-B, Page 5, Schedule L, Line 6b and 6d (Schedule L Other Current Assets Statement) Type Prepaid Insurance Other BOY Amount $260,000 $1,600,720 EOY Amount $280,001 $1,630,110
ABC Oil and Gas L P
66-0000006
Form 1065-B Test U.S. Return of Income for Electing Large Partnerships 2006 Calendar Year 2006 or tax year beginning , 2006, ending , 2006 Principal business activity A Mining Principal product or service B Oil and Gas Business code number C 211110 Name and Address: ABC Oil and Gas L P 28 Oil Rig Rd Anytown, TX 79001 Employer Identification number D 66-0000006 Date business started E 11/08/1999 Total assets F $5,617,088 Check applicable boxes 1,2,3,4 G Check accounting method 1,2,3 H 2 Number of Schedule K-1 I 2 Schedule M-3 Required (attached J Schedule M-3) Line Description Line Amount Write-in / Literal / Attachment Gross receipts or sales 1a $2,512,000 Less returns and allowances 1b Balance 1c $2,512,000 Cost of goods sold (Sch A, line 8) 2 $576,000 Gross profit. Subtract line 2 from 1c 3 $1,936,000 Net rental real estate income (loss) 4 Net income(loss) other rental act 5 Ordinary income (loss) other partner 6 Net farm profit (loss) 7 Excess of net short-term gain over net 8 long-term capital loss (SchD, line 14) Net gain (loss) Form 4797, Part II, line 17 9 Other income (loss) 10 Total income (loss) Combine lines 3 -10 11 $1,936,000 Salaries and wages 12 Guaranteed payments to partners 13 Repairs and maintenance 14 $224,165 Bad debts 15 Rent 16 Taxes and licenses 17 Interest 18 Depreciation & section 179 expense 19a Less depreciation claimed on Sch A 19b Total depreciation 19c Depletion 20 $148,180 Retirement plans, etc 21 Employee benefit programs 22 Other deductions 23 $226,740 Attachment 1 Total deductions. Add lines 12 – 23 24 $599,085 Taxable income (loss) from passive loss 25 (Subtract Line 24 from Line 11 $1,336,915 Tax check if from Form 4255 26a Tax check if from Form 8611 26b Other payments check if Form 2439 27a Other payments check if Form 4136 27b Tax due. Excess line 26 over line 27 28 Overpayment. Excess line 27 over 26 29 Taxable Income or Loss From Other Activities Interest 1 $550 Total ordinary dividends 2a Qualified dividends 2b
ABC Oil and Gas L P
66-0000006
2006
Form 1065-B Test U.S. Return of Income for Electing Large Partnerships Nonqualified dividends. Subtract Line 2b 2c from 2a Gross royalties 3 Excess of net short-term capital gain over 4 net long-term capital loss Schedule D line 17 Other income (loss) 5 Total income (loss) Add lines 1, 2c, 3, 4, 6 and 5 $550 Interest expenses investments debts 7 State and local income taxes 8 Charitable contributions 9 Total misc itemized deductions 10a Deductible amount Multiply line 10a by 10b 30% Other deductions 11 Total deductions. Add lines 7, 8, 9, 10b, 12 and 11 Taxable income (loss) from other 13 activities. Subtract line 12 from line 6 $550 Schedule A Cost of Goods Sold Inventory at beginning of year 1 Purchases less cost of items 2 Cost of labor 3 Additional section 263A costs 4 Other costs 5 $576,000 Attachment 2 Total. Add lines 1 – 5 6 $576,000 Inventory at the end of year 7 Cost of goods sold. Subtract Line 7 from 8 $576,000 6 9a (i) Cost in regulations section 1.471-3 Lower of cost or market 1.471-4 9a (ii) Other 9a (iii) Check if writedown subnormal goods 9b Check if the LIFO was adopted 9c Section 263A rules apply … 9d Change in determining quantities, cost, 9e valuations Schedule B Other Information Domestic general partnership 1a Domestic limited partnership 1b Domestic limited liability company 1c Domestic limited liability partnership 1d X Foreign partnership 1e Other 1f Any partners in this partnership also 2 N partnerships? Partnership own interest in another 3 N partnership or foreign entity? Partnership have foreign partners? 4 N Partnership publicly traded partnership? 5 N Partnership file Form 8264? 6 N Partnership have an interest in or a 7 N signature, or other authority over financial account in foreign country?
ABC Oil and Gas L P
Form 1065-B Test U.S. Return of Income for Electing Large Partnerships Partnership receive distribution from, 8 N granter of, transferor to foreign trust? Number of Forms 8865 attached 9 0 Schedule D Capital Gains and Losses Part I – Short-Term Capital Gains and Losses –-Assets Held 1Year or Less Description Date Date Sold Sales Price Cost or other of Property acquired basis (a) (b) (c) (d) (e) 1
66-0000006
2006
Gain or Loss (Subtract (e) from (d)) (f)
2 3 4
Short-term capital gain installment sales from Form 6252 Line 26 or 37 Short-term capital (loss) Form 8824 Net short-term capital gain (loss). Combine lines 1-3 in column (f) Part II – Long-Term Capital Gains and Losses – Assets Held More Than 1 Year Description Date Date Sold Sales Price Cost or other Gain or Loss of Property acquired basis (Subtract (e) (a) (b) (c) (d) (e) from (d)) (f)
5
6 7 8 9 10 11 12 13 14 15 16
Gain from Form 4797 Part I $2,500 Lone-term capital gain installment sales from Form 6252 Line 26 or 37 Long-term capital (loss) Form 8824 Net long-term capital gain (loss). $2,500 Combine lines 5 - 8 in column (f) Part III – Summary of Parts I and II Net gain (loss). Combine lines 4 & 9 $2,500 Excess net short-term capital gain (line 4) over net long-term capital loss (line 9) Net capital gain or (loss). Subtract line 11 $2,500 from line 10 Part IV- Net Capital Gain (Loss) from Passive Loss Limitation Activities Redetermine amount line 11 by taking into account only gains and losses from passive loss limitations activities Excess of net short-term capital gain over net long-term capital loss. Enter smaller of amount on line 11 or 13 Redetermine amount line 12 by taking into account only gains and losses from passive loss limitations activities Net capital gain or (loss) from passive loss limitation activities. If line 12 & 15 are both + or both -, enter smaller of line 12 or 15, otherwise enter 0
ABC Oil and Gas L P
66-0000006
Part V – Net Capital Gain (Loss) from Other Activities Excess of net short-term capital gain over net long-term capital loss. Subtract line 14 from line 11 Net capital gain or (loss) from other 18 $2,500 activities. Subtract line 16 from line 12 Schedule K Partners’ Share of Income, Credits, Deductions, ect. (a) Distributive share items (b) Total amount Taxable income(loss) from passive 1a $1,336,915 limitation activities (Part I line 25) Taxable income (loss) from trade or 1b(1) $66,458 business activities Taxable income (loss) from rental real 1b(2) estate activities Taxable income (loss) from other rental 1b(3) activities Total amount line 1a allocated to 1c $668,458 general partners. Combine lines 1b(1) – 1b(3) Taxable income (loss) from passive loss 1d $668,457 limitation activities allocated to limited part. Subtract line 1c from 1a Taxable income (loss) from other 2 $550 activities (Part II, line 13) Qualified dividends from other 3 activities (Part II, line 2b) Net capital gain (loss) from passive loss 4a limitation activities (SchD, ln 16) Net capital gain (loss) from other 4b $2,500 activities (Schedule D, line 18) Net passive alternative minimum tax 5 Net other alternative minimum tax adj 6 Guaranteed payments 7 Income discharge of indebtedness 8 Tax-exempt interest income 9 General credits 10 Low-income housing credit 11 Rehabilitation credit from real estate 12 activities Net earnings (loss) self employment 13a $668,458 Gross nonfarm income 13b Name of foreign country or U.S. 14a possession Name of foreign country or U.S. 14a possession Gross income from all sources 14b Gross income sourced at 14c partnership level 14d(1) Foreign gross income at partnership level – Passive 14d(2) Foreign gross income at partnership level - Listed categories 14d(3) Foreign gross income at partnership level - General limitation Deduction allocated and apportioned at 14e(1) partner level - Interest expense 17
ABC Oil and Gas L P
Deduction allocated and apportioned at partner level –Other Deductions allocated and apportioned at 14f(1) partnership level to foreign source income – Passive Deductions allocated and apportioned at 14f(2) partnership level to foreign source income - Listed categories Deductions allocated and apportioned at 14f(3) partnership level to foreign source income - General limitation Total foreign taxes Paid □ Accrued □ 14g Reduction in taxes available for credit 14h Other items and amounts required to be 15 reported separately to partners Analysis of Net Income (Loss) Net income (loss). Column (b), add lines 1 1c – 4, 7, and 8. From result, subtract $1,339,965 lines 15g(1) and (2) (i) (ii) (iii) (iv) Partnership (v) Exempt Corporate Individual Individual organization (active) (passive) Analysi 2a $669,982 s by General partners Analysi 2b $669,983 s by Limited partners Schedule L Balance Sheets per Books Beginning of tax year End of tax year 14e(2) 1 2a 2b 3 4 5 6 7 8 9a 9b 10a 10b 11 12a 12b Assets Cash Trade notes Less allowance Inventories U.S. govt oblig Tax-exempt securities Other current assets Mortgage & real estate loan Other investments Bldgs & other deprec assets Less accumulated deprec Depletable assts Less accumulated depletion Land Intangible assets Less accum (a) (b) $565,010 (c)
66-0000006
(vi) Nominee Other
Write-in / Literal
(d) $855,185
$1,860,720
$1,910,111
Attachment 4
$3,140,260 $375,140 $2,765,120 $10,000
$3,375,112 $523,320 $2,851,792 0
ABC Oil and Gas L P
66-0000006
amortization Other assets Total assets $5,200,850 $5,617,088 Liabilities (a) (b) (c) (d) Accounts 15 payable $470,588 $$205,366 Mortgages, 16 notes, bonds payable < 1yr Other current 17 liabilities All nonrecourse 18 loans $2,254,137 $1,205,380 Mortgages, 19 notes, bonds payable > 1yr Other liabilities 20 Partners’ capital 21 accounts $2,476,125 $4,206,342 Total labilities 22 and capital $5,200,850 $5,617,088 Schedule M-1 Reconciliation of Income (Loss) per Books With Income per Return Line Description Line Amount Write-in / Literal Net Income (loss) per books 1 $1,357,037 Income included on SchK lines 1c – 4b, 2 and 8, not recorded on the books this year (itemized): Guaranteed payments 3 Expenses recorded on books not included 4a SchK line 1c – 4b, and 15g (itemize) – Depreciation Expenses recorded on books not included 4b SchK line 1c – 4b, and 15g (itemize) Travel & entertainment $57,140 Total Expenses 4 Add lines 1 – 4 5 $1,414,177 Income recorded on books not included on 6a SchK, lines 1c – 4, and 8 (itemize) - Taxexempt interest Total Income 6 Deductions included on SchK lines 1c – 7a 4b, and 15g not charged against book (itemize) – Depreciation $74,212 Add lines 6 and 7 8 $74,212 Income (loss) (Analysis of net income 9 (loss) line 1). Subtract line 8 from line 5 $1,339,965 Schedule M-2 Analysis of Partners’ Capital Accounts Balance at beginning of year 1 $2,476,125 Capital contributed - Cash 2a Capital contributed - Property 2b Net income (loss) per books 3 $1,357,037 Other increases (itemized) 4 $373,180 5 Add lines 1 through 4 $4,206,342 Distributions – Cash 6a Distributions - Property 6b Other decreases (itemized) 7 Add lines 6 and 7 8 Balance at end of year. Sub line 8 from line 5 9 $4,206,342 13 14
ABC Oil and Gas L P
66-0000006
Form 4797 Sales of Business Property 2006 Name: ABC Oil and Gas LP EIN: 66-0000002 Line Description Line Amount Write-in / Literal / Attachments Gross receipts fm sales or exchg 1 Part I Sales or Exchanges of Property Used in a Trade or Business Description of property 2(a) Land Date acquired 2(b) 07/01/2000 Date sold 2(c) 06/30/2006 Gross sales price 2(d) $12,500 Depreciation allowed 2(e) Cost or other basis 2(f) $10,000 Gain or (loss) 2(g) $2,500 Gain fm F4684 3 Sec 1231 gain fm F6252 4 Sec 1231 gain fm F8824 5 Gain fm casualty or theft 6 Combine lines 2 to 6 7 Nonrecaptured net sec 1231 loss 8 Subtract line 8 from line 7 9 Part II Ordinary Gains and Losses 10(a) Description of property 10(b) Date acquired Date sold 10(c) 10(d) Gross sales price Depreciation allowed 10(e) Cost or other basis 10(f) 10(g) Gain or loss Loss fm line 7 11 Gain fm line 7 12 Gain fm line 31 13 Net gain F4684 14 Ordinary gain F6252 15 Ordinary gain F8824 16 Combine lines 10 to16 17 Part of loss F4684 18a Redetermined gain or (loss) on line 17 18b Part III Gain for Disposition of Property Under Sections 1245, 1250, 1252, 1254 and 1255 19(a) Description of property 19(b) Date acquired Date sold 19(c) Gross sales price 20 Cost or other basis 21 Depreciation allowed 22 Adjusted basis 23 Total gain 24 Depreciation allowed 25a Smaller of lines 24 and 25a 25b Additional depreciation after 1975 26a Applicable % 26b Subtract line 26a from line 24 26c Additional depreciation after 1969 26d Line Description Line Amount Write-in / Literal / Attachments Smaller of lines 26c and 26c 26e Sec 291 amount 26f Add lines 26b,26e and 26f 26g
ABC Oil and Gas L P
27a 27b 27c 28a 28b 29a 29b 30 31 32 Part IV 33(a) 33(b) 34(a) 34(b) 35(a) 35(b) Soil, water, land Line 27 multiplied by applicable % Smaller of lines 24 and 27b Intangible drilling Smaller of lines 24 and 28a Applicable % of payment excluded Smaller of lines 24 and 29a Total gain all property Add property columns A – D Subtract line 31 from line 30 Recapture Amounts Under Sections 179 and 280F(b)(2) Sec 179 expn ded – Sec 179 Sec 179 expn ded – Sec 280F(b) Recomputed deprc – Sec 179 Recomputed deprc- Sec280F(b) Recapture amount – Sec 179 Recapture amount – Sec 280F(b)
66-0000006
ABC Oil and Gas L P
66-0000006
Sch K-1 Partner’s Share of Income, (Loss) From an Electing Large 2006 (Form 1065-B) Partnership Corrected □ Publicly Traded Partnership □ Line Description Line Amount Write-in / Literal / Attachments Partnership's name, address, city, state, and ABC Oil and Gas LP Zip code 28 Oil Rig Rd Anytown, TX 79001 Partnership's employer identification number 66-0000006 Partner’s Identifying number 001-06-0014 Partner’s Name Jonathan Walker Street address 1657 E Forks Rd City, state and zip code Bay Shore, NY 11706 Partner’s share of liabilities – nonrecourse a $602,690 Partner’s share of liabilities – qualified b Partner’s share of liabilities – other c Taxable income (loss) from passive activities 1 $668,457 Taxable income (loss) from other activities 2 $275 Qualified dividends 3 4a Net capital gain (loss) from passive activities 4b Net capital gain (loss) from other activities $1,250 Net passive AMT adjustments 5 Net other AMT adjustments 6 General Credits 7 Low-income housing credit 8 Other 9 Sch K-1 Partner’s Share of Income, (Loss) From an Electing Large 2006 (Form 1065-B) Partnership Corrected □ Publicly Traded Partnership □ Line Description Line Amount Write-in / Literal / Attachments Partnership's name, address, city, state, and ABC Oil and Gas LP Zip code 28 Oil Rig Rd Anytown, TX 79001 Partnership's employer identification number 66-0000006 Partner’s Identifying number 001-06-0016 Partner’s Name Julius Caesar Walker Street address 1657 E Forks Rd City, state and zip code Bay Shore, NY 11706 Partner’s share of liabilities – nonrecourse a $602,690 Partner’s share of liabilities – qualified b Partner’s share of liabilities – other c Taxable income (loss) from passive activities 1 $668,458 Taxable income (loss) from other activities 2 $275 Qualified dividends 3 4a Net capital gain (loss) from passive activities 4b Net capital gain (loss) from other activities $1,250 Net passive AMT adjustments 5 Net other AMT adjustments 6 General Credits 7 Low-income housing credit 8 Other 9
ABC Cement Manufacturing
TEST SCENARIO 7
66-0000007
FORMS REQUIRED: 1065-B, 4562, 8825, 1065-B SCH K-1 (2), Form 8453-B, DEPENDENCIES ATTACHMENTS:
Itemized Other Deductions Schedule Schedule K-1(Form 1065-B) Miscellaneous Item Statement Qualified Nonrecourse Financing Statement
BINARY ATTACHMENTS: Scanned Form 8453-B (8453 Signature Document) HEADER INFO: Tax Period: Calendar Year 2006 Preparer Firm Electronic Tax Filers, Inc 1065 Efile Drive Anytown, WV 25001 66-0000007
MultipleSoftwarePackagesUsed: Yes or No Originator: EFIN: Self-select Type: ERO PractionerPIN: None PIN Entered by – N/A
Signature Option: Binary Attachment 8453 Signature Document Return Type: 1065-B Filer: EIN: 66-0000007 Name: ABC Cement Manufacturing Name Control: ABCC Address: 100 Concrete Ln Anytown, MN 55001 Name: John Macbeth Title: President Taxpayer PIN: N/A Phone: 555-555-5555 Email Address: Anymail@email.com Date Signed: 04/06/2006 Name: Jane Jones SSN: 162-10-0001 Phone: 555-555-5555 Email Address: Anymail@email.com Date Prepared: 04/12/2006 Self Employed: No
Partner:
Preparer:
IRS PAYMENT:
N/A
ABC Cement Manufacturing
Details for attachments to Form Attachment 1, Form 1065-B, Page 1, Line 23(Itemized Other Deductions Schedule) Type Professional Fees Permits Insurance Other Amount $558,000 $125,000 $325,000 $544,700
66-0000007
Attachment 2, Schedule K-1 (Form 1065-B), (Miscellaneous Item Statement) Code Number A1 B1 Code Name General Partners N/A Amount $34,770,193 $242,500
Attachment 3, Schedule K-1 (Form 1065-B), (Qualified Nonrecourse Financing Statement) Explanation of Qualified Nonrecourse Financing
ABC Cement Manufacturing
66-0000007
Form 1065-B Test U.S. Return of Income for Electing Large Partnerships 2006 Calendar Year 2006 or tax year beginning 01/01, 2006, ending 12/31, 2006 Principal business activity A Cement Manufacturer Principal product or service B Cement Business code number C 327300 Name and Address: ABC Cement Manufacturing 100 Concrete Ln Anytown, MN 55001 Employer Identification number D 66-0000007 Date business started E 01//19/1998 Total assets F $17,565,232 Check applicable boxes 1,2,3,4 G Check accounting method 1,2,3 H 2 Number of Schedule K-1 I 2 Schedule M-3 Required (attach Schedule J M-3) Line Description Line Amount Write-in / Literal / Attachment Gross receipts or sales 1a $41,175,200 Less returns and allowances 1b Balance 1c $41,175,200 Cost of goods sold (Sch A, line 8) 2 $26,954,578 Gross profit. Subtract line 2 from 1c 3 $14,220,622 Net rental real estate income (loss) 4 $485,000 Net income(loss) other rental act 5 Ordinary income (loss) other partner 6 Net farm profit (loss) 7 Excess of net short-term gain over net 8 long-term capital loss (SchD, line 14) Net gain (loss) Form 4797, Part II, line 17 9 Other income (loss) 10 Total income (loss) Combine lines 3 -10 11 $14,705,622 Salaries and wages 12 $2,162,319 Guaranteed payments to partners 13 Repairs and maintenance 14 $1,036,752 Bad debts 15 Rent 16 Taxes and licenses 17 $1,414,186 Interest 18 Depreciation & section 179 expense 19a $314,279 Less depreciation claimed on Sch A 19b Total depreciation 19c $314,279 Depletion 20 $148,180 Retirement plans, etc 21 Employee benefit programs 22 $786,000 Other deductions 23 $1,522,700 Attachment 1 Total deductions. Add lines 12 – 23 24 $7,266,236 Taxable income (loss) from passive loss 25 (Subtract Line 24 from Line 11 $7,439,386 Tax check if from Form 4255 26a Tax check if from Form 8611 26b Other payments check if Form 2439 27a Other payments check if Form 4136 27b Tax due. Excess line 26 over line 27 28 Overpayment. Excess line 27 over 26 29 Taxable Income or Loss From Other Activities Interest 1 $37,412 Total ordinary dividends 2a Qualified dividends 2b
ABC Cement Manufacturing
Form 1065-B Test U.S. Return of Income for Electing Large Partnerships Nonqualified dividends. Subtract Line 2b 2c from 2a Gross royalties 3 Excess of net short-term capital gain over 4 net long-term capital loss Schedule D line 17 Other income (loss) 5 Total income (loss) Add lines 1, 2c, 3, 4, 6 and 5 $37,412 Interest expenses investments debts 7 State and local income taxes 8 Charitable contributions 9 Total misc itemized deductions 10a Deductible amount Multiply line 10a by 10b 30% Other deductions 11 Total deductions. Add lines 7, 8, 9, 10b, 12 and 11 Taxable income (loss) from other 13 activities. Subtract line 12 from line 6 $37,412 Schedule A Cost of Goods Sold Inventory at beginning of year 1 $3,211,146 Purchases less cost of items 2 $22,247,630 Cost of labor 3 $4,312,216 Additional section 263A costs 4 Other costs 5 Total. Add lines 1 – 5 6 $29,770,992 Inventory at the end of year 7 $2,816,414 Cost of goods sold. Subtract Line 7 from 8 $26,954,578 6 Cost in regulations section 1.471-3 9a (i) Lower of cost or market 1.471-4 9a (ii) Other 9a (iii) Check if writedown subnormal goods 9b Check if the LIFO was adopted 9c Section 263A rules apply … 9d Change in determining quantities, cost, 9e valuations Schedule B Other Information Domestic general partnership 1a Domestic limited partnership 1b Domestic limited liability company 1c X Domestic limited liability partnership 1d Foreign partnership 1e Other 1f Any partners in this partnership also 2 N partnerships? Partnership own interest in another 3 N partnership or foreign entity? Partnership have foreign partners? 4 N Partnership publicly traded partnership? 5 N Partnership file Form 8264? 6 N Partnership have an interest in or a 7 N signature, or other authority over financial account in foreign country? Partnership receive distribution from, 8 N granter of, transferor to foreign trust?
66-0000007
2006
ABC Cement Manufacturing
Form 1065-B Test U.S. Return of Income for Electing Large Partnerships Number of Forms 8865 attached 9 0 Schedule D Capital Gains and Losses Part I – Short-Term Capital Gains and Losses –-Assets Held 1Year or Less Description Date Date Sold Sales Price Cost or other of Property acquired basis (a) (b) (c) (d) (e) 1
66-0000007
2006
Gain or Loss (Subtract (e) from (d)) (f)
2 3 4
Short-term capital gain installment sales from Form 6252 Line 26 or 37 Short-term capital (loss) Form 8824 Net short-term capital gain (loss). Combine lines 1-3 in column (f) Part II – Long-Term Capital Gains and Losses – Assets Held More Than 1 Year Description Date Date Sold Sales Price Cost or other Gain or Loss of Property acquired basis (Subtract (e) from (a) (b) (c) (d) (e) (d)) (f)
5 6 7 8 9 10 11 12 13 14 15 16 Gain from Form 4797 Part I Lone-term capital gain installment sales from Form 6252 Line 26 or 37 Long-term capital (loss) Form 8824 Net long-term capital gain (loss). Combine lines 5 - 8 in column (f) Part III – Summary of Parts I and II Net gain (loss). Combine lines 4 & 9 Excess net short-term capital gain (line 4) over net long-term capital loss (line 9) Net capital gain or (loss). Subtract line 11 from line 10 Part IV- Net Capital Gain (Loss) from Passive Loss Limitation Activities Redetermine amount line 11 by taking into account only gains and losses from passive loss limitations activities Excess of net short-term capital gain over net long-term capital loss. Enter smaller of amount on line 11 or 13 Redetermine amount line 12 by taking into account only gains and losses from passive loss limitations activities Net capital gain or (loss) from passive loss limitation activities. If line 12 & 15 are both + or both -, enter smaller of line 12 or 15, otherwise enter 0 Part V – Net Capital Gain (Loss) from Other Activities Excess of net short-term capital gain over net long-term capital loss. Subtract line 14 from line 11 Net capital gain or (loss) from other activities. Subtract line 16 from line 12
17 18
ABC Cement Manufacturing
Schedule K Partners’ Share of Income, Credits, Deductions, ect. (a) Distributive share items (b) Total amount Taxable income(loss) from passive 1a $7,439,386 limitation activities (Part I line 25) Taxable income (loss) from trade or 1b(1) $3,477,193 business activities Taxable income (loss) from rental real 1b(2) $242,500 estate activities Taxable income (loss) from other rental 1b(3) activities Total amount line 1a allocated to 1c $3,719,693 general partners. Combine lines 1b(1) – 1b(3) Taxable income (loss) from passive loss 1d $3,719,693 limitation activities allocated to limited part. Subtract line 1c from 1a Taxable income (loss) from other 2 $37,412 activities (Part II, line 13) Qualified dividends from other 3 activities (Part II, line 2b) Net capital gain (loss) from passive loss 4a limitation activities (SchD, ln 16) Net capital gain (loss) from other 4b activities (Schedule D, line 18) Net passive alternative minimum tax 5 Net other alternative minimum tax adj 6 Guaranteed payments 7 Income discharge of indebtedness 8 Tax-exempt interest income 9 General credits 10 Low-income housing credit 11 Rehabilitation credit from real estate 12 activities Credit for producing fuel from 13 nonconventional source Net earnings (loss) self employment 13a Gross nonfarm income 13b Name of foreign country or U.S. 14a possession Gross income from all sources 14b Gross income sourced at 14c partnership level Foreign gross income at partnership 14d(1) level – Passive Foreign gross income at partnership 14d(2) level - Listed categories Foreign gross income at partnership 14d(3) level - General limitation Deduction allocated and apportioned at 14e(1) partner level - Interest expense Deduction allocated and apportioned at 14e(2) partner level -Other Deductions allocated and apportioned at 14f(1) partnership level to foreign source income – Passive Deductions allocated and apportioned at 14f(2) partnership level to foreign source income - Listed categories
66-0000007
ABC Cement Manufacturing
Deductions allocated and apportioned at partnership level to foreign source income - General limitation Total foreign taxes Paid □ Accrued □ 14g Reduction in taxes available for credit 14h Other items and amounts required to be 15 reported separately to partners Analysis of Net Income (Loss) Net income (loss). Column (b), add lines 1c 1 – 4, 7, and 8. From result, subtract lines 15g(1) and (2) (i) (ii) (iii) Corporate Individual Individual (active) (passive) Analysis 2a $3,738,399 14f(3)
by General partners Analysis by Limited partners
66-0000007
$7,476,798 (iv) Partnership (v) Exempt organization (vi) Nominee Other
2b
$3,738,399
Form 4562 Depreciation and Amortization 2006 Name: ABC Cement Manufacturing Business or Activity: Cement Manufacturing EIN: 66-0000007 Line Description Line Amount Write-in / Literal / Attachments Part I Election to Expense Certain Property Under Section 179 Maximum amount 105,000 1 Total cost of section 179 prop 2 $80,500 Threshold cost of section 179 prop 420,000 3 Reduction in limitation 4 Dollar limitation for TY 5 $105,000 Description of Property 6(a) Dump Truck Cost 6(b) $80,500 Elected cost 6(c) $80,500 Listed property 7 Total elected cost of sec 179 prop 8 $80,500 Tentative deduction 9 $80,500 Carryover of disallowed deduction 10 Business income limitation 11 $105,000 Section 179 expense deduction 12 $80,500 Carryover of disallowed deduction 13 Part II Special Depreciation Allowance and Other Depreciation Special depreciation allowed 14 Property subject to sec 168(f)(1) election 15 Other depreciation 16 Part III MACRS Depreciation - Section A 17 MACRS deductions $280,063 Dependency Sec 168(i)(4) election 18
ABC Cement Manufacturing
66-0000007
Section B – Assets Placed in Service During 2006 Tax Year Using the General Depreciation System (a)Classification (b)Mont (c) Basis (d)Recovery (e) (f)Meth (g)Deprc of property h& for deprec period Conventi od deduct Year on 3-year property 5-year property $120,000 5 yrs HY 200DB $24,000 7-year property $256,500 7 yrs HY 200DB $36,654 10-year property 15-year property 20-year property 25-year property S/L Residential rental MM S/L property Nonresidential real 19i 39 yrs MM S/L property Section C – Assets Placed in Service During 2006 Tax Year Using the Alternative Depreciation System Class life 20a 12-year S/L 20b 40-year MM S/L 20c Part IV Summary Listed property 21 Total 22 $340,717 Assets for CY 23 19a 19b 19c 19d 19e 19f 19g 19h Part V Listed Property Section A – Depreciation and Other Information Evidence? 24a Evidence written? 24b Special depreciation allowance 25 Type of property 26(a) Date in service 26(b) Business investment % 26(c) Cost or other basis 26(d) Basis for depreciation 26(e) Recovery period 26(f) Method/Convention 26(g) Depreciation deduction 26(h) Election Sec 179 cost 26(i) Type of property 27(a) Date in service 27(b) Business investment % 27(c) Cost or other basis 27(d) Basis for depreciation 27(e) Recovery period 27(f) Method/Convention 27(g) Depreciation deduction 27(h) Election Sec 179 cost 27(i) Add column (h), lines 25 - 27 28 Add column (i), line 26 29 Section B – Information on Use of Vehicles Total bus/invest miles driven 30(a) Total commuting miles driven 31(a) Tot other personal miles driven 32(a) Total miles driven 33(a)
Write-in / Literal / Attachments
ABC Cement Manufacturing
66-0000007
Vehicle available for personal use? 34 Vehicle used > 5% ? 35 Another vehicle avail for personal use? 36 Section C – Questions for Employers Who Provide Vehicles for Use by Their Employees Maint written policy prohibits commu? 37 Maint written policy prohibits pers use 38 Vehicles treated as personal use? 39 Provide > 5 vehicle? 40 Qualified auto demonstration use? 41 Part VI Amortization (a)Depreciation (b) Date (c) Amort (d)Cod (e)Amort (f)Amort of costs amort begins amount e period or for this section percent Yr 42 43 44
Write-in / Literal / Attachments
Amort of costs before 2006 TY Total Rental Real Estate Income and Expenses of a Partnership or an S Corporation 2006
Form 8825
Name: ABC Cement Manufacturing EIN: 66-0000007 Line Description Kind & location of each property 1A 2A 3A 4A 5A 6A 7A 8A 9A 10A 11A 12A 13A 14A 15A 16A 17 18 19 20a 20b(1) 20b(2) 21 Gross rents Advertising Auto and travel Cleaning and maintenance Commissions Insurance Legal and other professional fees Interest Repairs Taxes Utilities Wages and salaries Depreciation Other Total expense for each property Total gross rents Total expenses Net gain (loss) F4797 Net income (loss) from rental real estate activities Name EIN Net rental real estate income (loss)
Line Amount / Information Warehouse 200 Metamorphic Rd Anytown, MN 55001 $615,000 $24,000
Write-in / Literal / Attachments
$26,500 $42,312 $10,750
$26,438 $130,000 $615,000 ($130,000)
$485,000
ABC Cement Manufacturing
66-0000007
Sch K-1 Partner’s Share of Income, (Loss) From an Electing Large 2006 (Form 1065-B) Partnership Corrected □ Publicly Traded Partnership □ Line Description Line Amount Write-in / Literal / Attachments Partnership's name, address, city, state, and ABC Cement Zip code Manufacturing 100Concrete Ln Anytown, MN 55001 Partnership's employer identification number 66-0000007 Partner’s Identifying number 001-06-0017 Partner’s Name John Macbeth Street address 1168 Beech St City, state and zip code Central Islip, NY 11722 Partner’s share of liabilities – nonrecourse a Partner’s share of liabilities – qualified b $3,000,000 Partner’s share of liabilities – other c Taxable income (loss) from passive activities 1 $3,719,693 Taxable income (loss) from other activities 2 $18,706 Qualified dividends 3 Net capital gain (loss) from passive activities 4a Net capital gain (loss) from other activities 4b Net passive AMT adjustments 5 Net other AMT adjustments 6 General Credits 7 Low-income housing credit 8 Other 9 $35,353,410 Dependency Sch K-1 Partner’s Share of Income, (Loss) From an Electing Large 2006 (Form 1065-B) Partnership Corrected □ Publicly Traded Partnership □ Line Description Line Amount Write-in / Literal / Attachments Partnership's name, address, city, state, and Zip ABC Cement code Manufacturing 100Concrete Ln Anytown, MN 55001 Partnership's employer identification number 66-0000007 Partner’s Identifying number 001-06-0018 Partner’s Name John Capulet Street address 1175 Beech St City, state and zip code Central Islip, NY 11722 Partner’s share of liabilities – nonrecourse a Partner’s share of liabilities – qualified b $3,000,000 Partner’s share of liabilities – other c Taxable income (loss) from passive activities 1 $3,719,693 Taxable income (loss) from other activities 2 $18,706 Qualified dividends 3 Net capital gain (loss) from passive activities 4a Net capital gain (loss) from other activities 4b Net passive AMT adjustments 5 Net other AMT adjustments 6 General Credits 7 Low-income housing credit 8 Other 9
Black Coal Industries LLC
TEST SCENARIO 8 FORMS REQUIRED: 1065-B, 8308, 1065-B SCH K-1 (101) ATTACHMENTS: Itemized Other Deductions Schedule BINARY ATTACHMENTS: None HEADER INFO: Tax Period: Calendar Year 2006 Preparer Firm Electronic Tax Filers, Inc 1065 Efile Drive Anytown, WV 25001 66-0000008
66-0000008
MultipleSoftwarePackagesUsed: Yes or No Originator: EFIN: Self-select Type: ERO PractionerPIN: EFIN: Self-select PIN: Self-select PIN Entered by – ERO
Signature Option: PIN Number Return Type: 1065-B Filer: EIN: 66-0000008 Name: Black Coal Industries LLC Name Control: BLAC Address: 100 Main St Anytown, WV 25001 Name: Bubba Christmas Title: Chief Executive Officer Taxpayer PIN: N/A Phone: 555-555-5555 Email Address: Anymail@email.com Date Signed: 03/15/2006 Name: John Dark SSN: 663-00-0001 Phone: Email Address: Anymail@email.com Date Prepared: 04/01/2006 Self Employed: No
Partner:
Preparer:
IRS PAYMENT:
N/A
Black Coal Industries LLC
66-0000008
Details for attachments to Form Attachment 1 Form 1065-B, Page 1, Line 23 (Itemized Other Deductions Schedule) Type Engineering Permits Legal and Accounting Consulting Amount $2,168,140 $1,400,000 $1,600,320 $385,914
Black Coal Industries LLC
Form 1065-B Test U.S. Return of Income for Electing Large Partnerships Calendar Year 2006 or tax year beginning 01/01, 2006, ending 12/31, 2006 Principal business activity A Mining Principal product or service B Coal Business code number C 212110 Name and Address: Black Coal Industries LLC 100 Main St Anytown, WV 25001 Employer Identification number D 66-0000008 Date business started E 08/03/1998 Total assets F $20,440,320 Check applicable boxes 1,2,3,4 G Check accounting method 1,2,3 H 2 Number of Schedule K-1 I 101 J Schedule M-3 Required (attach Schedule M-3) Line Description Line Amount Gross receipts or sales $101,256,342 Less returns and allowances Balance $101,256,342 Cost of goods sold (Sch A, line 8) $58,332,511 Gross profit. Subtract line 2 from 1c $42,923,831 Net rental real estate income (loss) Net income(loss) other rental act Ordinary income (loss) other partner Net farm profit (loss) Excess of net short-term gain over net long-term capital loss (SchD, line 14) Net gain (loss) Form 4797, Part II, line 17 Other income (loss) Total income (loss) Combine lines 3 -10 $42,923,831 Salaries and wages $12,487,136 Guaranteed payments to partners Repairs and maintenance $2,612,540 Bad debts Rent $1,720,000 Taxes and licenses $4,106,315 Interest Depreciation & section 179 expense Less depreciation claimed on Sch A Total depreciation Depletion $3,750,225 Retirement plans, etc Employee benefit programs $1,218,412 Other deductions $5,554,374 Total deductions. Add lines 12 – 23 $31,449,002 Taxable income (loss) from passive loss (Subtract Line 24 from Line 11 $11,474,829 Tax check if from Form 4255 Tax check if from Form 8611 Other payments check if Form 2439 Other payments check if Form 4136 Tax due. Excess line 26 over line 27 Overpayment. Excess line 27 over 26 Taxable Income or Loss From Other Activities Interest $357,610 Total ordinary dividends Qualified dividends
66-0000008
2006
Write-in / Literal / Attachment
1a 1b 1c 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19a 19b 19c 20 21 22 23 24 25 26a 26b 27a 27b 28 29 1 2a 2b
Attachment 1
Black Coal Industries LLC
Form 1065-B Test U.S. Return of Income for Electing Large Partnerships Nonqualified dividends. Subtract Line 2b 2c from 2a Gross royalties 3 $1,569,721 Excess of net short-term capital gain over 4 net long-term capital loss Schedule D line 17 Other income (loss) 5 Total income (loss) Add lines 1, 2c, 3, 4, 6 and 5 $37,412 Interest expenses investments debts 7 State and local income taxes 8 Charitable contributions 9 Total misc itemized deductions 10a Deductible amount Multiply line 10a by 10b 30% Other deductions 11 Total deductions. Add lines 7, 8, 9, 10b, 12 and 11 Taxable income (loss) from other 13 activities. Subtract line 12 from line 6 $1,569,721 Schedule A Cost of Goods Sold Inventory at beginning of year 1 $5,650,225 Purchases less cost of items 2 $57,478,827 Cost of labor 3 $1,425,622 Additional section 263A costs 4 Other costs 5 Total. Add lines 1 – 5 6 $64,554,674 Inventory at the end of year 7 $6,222,163 Cost of goods sold. Subtract Line 7 from 8 $58,332,511 6 9a (i) Cost in regulations section 1.471-3 Lower of cost or market 1.471-4 9a (ii) X Other 9a (iii) Check if writedown subnormal goods 9b Check if the LIFO was adopted 9c Section 263A rules apply … 9d No Change in determining quantities, cost, 9e No valuations Schedule B Other Information Domestic general partnership 1a Domestic limited partnership 1b Domestic limited liability company 1c X Domestic limited liability partnership 1d Foreign partnership 1e Other 1f Any partners in this partnership also 2 N partnerships? Partnership own interest in another 3 N partnership or foreign entity? Partnership have foreign partners? 4 N Partnership publicly traded partnership? 5 N Partnership file Form 8264? 6 N Partnership have an interest in or a 7 N signature, or other authority over financial account in foreign country?
66-0000008
2006
Black Coal Industries LLC
Form 1065-B Test U.S. Return of Income for Electing Large Partnerships Partnership receive distribution from, 8 N granter of, transferor to foreign trust? Number of Forms 8865 attached 9 0 Schedule D Capital Gains and Losses Part I – Short-Term Capital Gains and Losses –-Assets Held 1Year or Less Description Date Date Sold Sales Price Cost or other of Property acquired basis (a) (b) (c) (d) (e) 1
66-0000008
2006
Gain or Loss (Subtract (e) from (d)) (f)
2 3 4
Short-term capital gain installment sales from Form 6252 Line 26 or 37 Short-term capital (loss) Form 8824 Net short-term capital gain (loss). Combine lines 1-3 in column (f) Part II – Long-Term Capital Gains and Losses – Assets Held More Than 1 Year Description Date Date Sold Sales Price Cost or other Gain or Loss of Property acquired basis (Subtract (e) (a) (b) (c) (d) (e) from (d)) (f)
5
6 7 8 9 10 11 12 13 14 15 16
Gain from Form 4797 Part I Lone-term capital gain installment sales from Form 6252 Line 26 or 37 Long-term capital (loss) Form 8824 Net long-term capital gain (loss). Combine lines 5 - 8 in column (f) Part III – Summary of Parts I and II Net gain (loss). Combine lines 4 & 9 Excess net short-term capital gain (line 4) over net long-term capital loss (line 9) Net capital gain or (loss). Subtract line 11 from line 10 Part IV- Net Capital Gain (Loss) from Passive Loss Limitation Activities Redetermine amount line 11 by taking into account only gains and losses from passive loss limitations activities Excess of net short-term capital gain over net long-term capital loss. Enter smaller of amount on line 11 or 13 Redetermine amount line 12 by taking into account only gains and losses from passive loss limitations activities Net capital gain or (loss) from passive loss limitation activities. If line 12 & 15 are both + or both -, enter smaller of line 12 or 15, otherwise enter 0
Black Coal Industries LLC
Part V – Net Capital Gain (Loss) from Other Activities Excess of net short-term capital gain over net long-term capital loss. Subtract line 14 from line 11 Net capital gain or (loss) from other 18 activities. Subtract line 16 from line 12 Schedule K Partners’ Share of Income, Credits, Deductions, ect. (a) Distributive share items (b) Total amount Taxable income(loss) from passive 1a $11,474,829 limitation activities (Part I line 25) Taxable income (loss) from trade or 1b(1) business activities Taxable income (loss) from rental real 1b(2) estate activities Taxable income (loss) from other rental 1b(3) activities Total amount line 1a allocated to 1c general partners. Combine lines 1b(1) – 1b(3) Taxable income (loss) from passive loss 1d $11,474,829 limitation activities allocated to limited part. Subtract line 1c from 1a Taxable income (loss) from other 2 $1,569,721 activities (Part II, line 13) Qualified dividends from other 3 activities (Part II, line 2b) Net capital gain (loss) from passive loss 4a limitation activities (SchD, ln 16) Net capital gain (loss) from other 4b activities (Schedule D, line 18) Net passive alternative minimum tax 5 Net other alternative minimum tax adj 6 Guaranteed payments 7 Income discharge of indebtedness 8 Tax-exempt interest income 9 General credits 10 Low-income housing credit 11 Rehabilitation credit from real estate 12 activities Credit for producing fuel from 13 nonconventional source Net earnings (loss) self employment 13a Gross nonfarm income 14b Name of foreign country or U.S. 15a possession Gross income from all sources 15b Gross income sourced at 15c partnership level 15d(1) Foreign gross income at partnership level - Passive 15d(2) Foreign gross income at partnership level - Listed categories 15d(3) Foreign gross income at partnership level - General limitation Deduction allocated and apportioned at 15e(1) partner level - Interest expense Deduction allocated and apportioned at 15e(2) partner level -Other 17
66-0000008
Black Coal Industries LLC
Deductions allocated and apportioned at partnership level to foreign source income - Passive Deductions allocated and apportioned at 15f(2) partnership level to foreign source income - Listed categories Deductions allocated and apportioned at 15f(3) partnership level to foreign source income - General limitation Total foreign taxes Paid □ Accrued □ 15g Reduction in taxes available for credit 15h Other items and amounts required to be 16 reported separately to partners Analysis of Net Income (Loss) Net income (loss). Column (b), add lines 1c – 1 4, 7, and 8. From result, subtract lines 15g(1) and (2) (i) (ii) (iii) Corporate Individual Individual (active) (passive) Analysis 2a 15f(1)
by General partners Analysis by Limited partners
66-0000008
$13,044,550 (iv) Partnership (v) Exempt organization (vi) Nominee Other
2b
$13,044,550
Form 8308
Report of a Sale or Exchange of Certain Partnership Interests Name of Partnership: Black Coal Industries Telephone number: (555)555-5555 Employer identification number: 66-0000008 Number, street, and room or suite: 100 Main St City or Town, State and Zip Code Anytown, WV 25001 Part I Transferor Information Name Bronco Juno Identifying number 001-06-0019 Number and street 300 Main St City or Town, State and Zip Code Anytown, WV 25001 Part II Transferee Information Name Bubba Christmas Identifying number 001-06-0020 Number and street 200 Main St City or Town, State and Zip Code Anytown, WV 25001 Part III Date of Sale or Exchange of Partnership Interest
2006
Black Coal Industries LLC
66-0000008
Sch K-1 Partner’s Share of Income, (Loss) From an Electing Large 2006 (Form 1065-B) Partnership Corrected □ Publicly Traded Partnership □ Line Description Line Amount Write-in / Literal / Attachments Partnership's name, address, city, state, and Black Coal Industries, Zip code LLC 100 Main St Anytown, WV 25001 Partnership's employer identification number 66-0000008 Partner’s Identifying number 001-06-2001 Partner’s Name Taxpayer B1 Street address 1001 Main St City, state and zip code Anytown, WV 25001 Partner’s share of liabilities – nonrecourse A $52,635 Partner’s share of liabilities – qualified B Partner’s share of liabilities – other C Taxable income (loss) from passive activities 1 $114,748 Taxable income (loss) from other activities 2 $15,697 Qualified dividends 3 4a Net capital gain (loss) from passive activities 4b Net capital gain (loss) from other activities Net passive AMT adjustments 5 Net other AMT adjustments 6 General Credits 7 Low-income housing credit 8 Other 9 Sch K-1 Partner’s Share of Income, (Loss) From an Electing Large 2006 (Form 1065-B) Partnership Corrected □ Publicly Traded Partnership □ Line Description Line Amount Write-in / Literal / Attachments Partnership's name, address, city, state, and Black Coal Industries, Zip code LLC 100 Main St Anytown, WV 25001 Partnership's employer identification number 66-0000008 Partner’s Identifying number 001-06-0020 Partner’s Name Bubba Christmas Street address 200 Main St City, state and zip code Anytown, WV 25001 Partner’s share of liabilities – nonrecourse A $26,318 Partner’s share of liabilities – qualified B Partner’s share of liabilities – other C Taxable income (loss) from passive activities 1 $57,374 Taxable income (loss) from other activities 2 $7,849 Qualified dividends 3 4a Net capital gain (loss) from passive activities 4b Net capital gain (loss) from other activities Net passive AMT adjustments 5 Net other AMT adjustments 6 General Credits 7 Low-income housing credit 8 Other 9
Black Coal Industries LLC
66-0000008
Sch K-1 Partner’s Share of Income, (Loss) From an Electing Large 2006 (Form 1065-B) Partnership Corrected □ Publicly Traded Partnership □ Line Description Line Amount Write-in / Literal / Attachments Partnership's name, address, city, state, and Black Coal Industries, Zip code LLC 100 Main St Anytown, WV 25001 Partnership's employer identification number 66-0000008 Partner’s Identifying number 001-06-0019 Partner’s Name Bronco Juno Street address 300 Main St City, state and zip code Anytown, WV 25001 Partner’s share of liabilities – nonrecourse A Partner’s share of liabilities – qualified B Partner’s share of liabilities – other C Taxable income (loss) from passive activities 1 $57,374 Taxable income (loss) from other activities 2 $7,848 Qualified dividends 3 4a Net capital gain (loss) from passive activities 4b Net capital gain (loss) from other activities Net passive AMT adjustments 5 Net other AMT adjustments 6 General Credits 7 Low-income housing credit 8 Other 9
RamcFile, Inc. TEST SCENARIO 1 FORMS REQUIRED: 7004 HEADER INFO: Tax Period: Preparer Firm 11/01/2005 – 10/31/2006 Electronic Tax Filers, Inc. 100 Efile Drive Anytown, TX 78621 N/A 7004 11-0000011
11-0000030
PIN Entered by Return Type:
Filer:
EIN: 11-0000030 Name: RamcFile, Inc. Name Control: RAMC Address: 100 Main Street Downtown, MD 20601 Name: Roger Rabbit Title: Chief Executive Officer Taxpayer PIN: N/A Phone: 703-555-1212 Email Address: DateSigned: 01/25/06 200610
Officer:
Tax Year:
Binary Attachment Count: 0
RamcFile, Inc.
11-0000030
Form 7004 Test #1
(Code 25 = Form 1120S)
Application for Automatic 6-Month Extension of Time to File Certain Business Income Tax, Information, and Other Returns
TY 2005
Name: RamcFile, Inc Taxpayer identification number: 11-0000030 Number, street, and room: 101 Main Street City or town, State, Zip code: Downtown, MD 20601 Line Description Line Amount / Information Code for type of return for 6-mos ext 1 Org does not have office in US 2
checkbox
Write-in / Literal 25
3 4a 4b 5 6 7 8
Qualify under Sec 1.6081-5 checkbox Calendar yr or other year beginning and ending Short TY < 12 months check reason Corp and com parent of consolidated
grp
November 1, 2005 October 31, 2006
Tentative total tax Total payments and credits Balance due. Subtract line 7 from line 6
1,000 1,000 0
ModeNTech, Inc.
11-0000031
TEST SCENARIO 2 FORMS REQUIRED: 7004 ATTACHMENTS: ConsolidatedGroupMembersSch
HEADER INFO: Tax Period: Preparer Firm 11/01/2006 – 10/31/2007 Electronic Tax Filers, Inc. 100 Efile Drive Anytown, TX 78621 N/A 7004 11-0000011
PIN Entered by Return Type:
Filer:
EIN: 11-0000031 Name: ModeNTech, Inc Name Control: MODE Address: 301 New Street Newtown, ND 58204 200710
Tax Year:
Binary Attachment Count: 0
IRS PAYMENT: RTN: 012345672 ACCT #: 1234000000 TYPE OF ACCOUNT: Checking AMOUNT OF PAYMENT: 4,400 REQUESTED PAYMENT DATE: January 15, 2008 TAXPAYER DAYTIME PHONE NUMBER: 512-555-1111
Details for Form 7004 Attachment 1, Form 7004, Line 5, (ConsolidatedGroupMembersSch): a. Name: Hottest Communications Address: 100 Mail Avenue, Uptown, OH 45324 EIN: 11-0000043 b. Name: High-Tech Solutions Address: 200 Main Street, Anytown, NC 27905 EIN: APPLIED FOR
ModeNTech, Inc.
11-0000031
Form 7004 Test #2
(Code 12 = Form 1120)
Application for Automatic 6-Month Extension of Time to File Certain Business Income Tax, Information, and Other Returns
TY 2006
Name: ModeNTech, Inc Taxpayer identification number: 11-0000031 Number, street, and room: 301 New Street City or town, State, Zip code: Newtown, ND 58204 Line Description Line Amount / Information Code for type of return for 6-mos ext 1 Org does not have office in US 2
checkbox
Write-in / Literal 12
3 4a 4b 5 6 7 8
Qualify under Sec 1.6081-5 checkbox Calendar yr or other year beginning and ending Short TY < 12 months check reason Corp and com parent of consolidated grp Tentative total tax Total payments and credits Balance due. Subtract line 7 from line 6
November 1, 2006 October 31, 2007 Checkbox checked 5,000 600 4,400 Attachment 1
FOREIGNCO Group
TEST SCENARIO 3 FORMS REQUIRED: 7004
11-0000033
HEADER INFO: Tax Period: Return Type: 08/01/2006– 07/31/2007 7004
Filer:
EIN: 11-0000033 Name: FOREIGNCO Group Name Control: FORE Address: 2 Rue Street Paris City, France 200707
Tax Year:
Binary Attachment Count: 0
IRS PAYMENT: None
FOREIGNCO Group
11-0000033
Form 7004 Test #3 (Code 15 =
Form 1120-F)
Application for Automatic 6-Month Extension of Time to File Certain Business Income Tax, Information, and Other Returns
TY 2006
Name:FOREIGNCO Group Taxpayer identification number: 11-0000033 Number, street, and room: 2 Rue Street City or town, State, Zip code: Paris City, France Line Description Line Amount / Information Code for type of return for 6-mos ext 1 Org does not have office in US 2
checkbox
Write-in / Literal 15
3 4a 4b 5 6 7 8
Qualify under Sec 1.6081-5 checkbox Calendar yr or other year beginning and ending Short TY < 12 months check reason Corp and com parent of consolidated
grp
Checkbox checked August 1, 2006 July 31, 2007
Tentative total tax Total payments and credits Balance due. Subtract line 7 from line 6
10,000 9,000 1,000
Flower Store One
TEST SCENARIO 4 FORMS REQUIRED: 7004
11-0000049
HEADER INFO: Tax Period: Return Type: 08/01/2006– 07/31/2007 7004
Filer:
EIN: 11-0000049 Name: Flower Store One Name Control: FLOW Address: 3 Bulb Street Somewhere, TX 78621 200707
Tax Year:
Binary Attachment Count: 0
IRS PAYMENT: None
Flower Store One
11-0000049
Form 7004 Test #4
(Code 09 = Form 1065)
Application for Automatic 6-Month Extension of Time to File Certain Business Income Tax, Information, and Other Returns
TY 2006
Name: Flower Store One Taxpayer identification number: 11-0000049 Number, street, and room: 3 Bulb Street City or town, State, Zip code: Somewhere, TX 78621 Line Description Line Amount / Information Code for type of return for 6-mos ext 1 Org does not have office in US 2
checkbox
Write-in / Literal 09
3 4a 4b 5 6 7 8
Qualify under Sec 1.6081-5 checkbox Calendar yr or other year beginning and ending Short TY < 12 months check reason Corp and com parent of consolidated
grp
August 1, 2006 July 31, 2007
Tentative total tax Total payments and credits Balance due. Subtract line 7 from line 6
10,000 9,000 1,000
RedesignComp, Inc.
TEST SCENARIO 5 FORMS REQUIRED: 7004
11-0000050
HEADER INFO: Tax Period: Return Type: 08/01/2006– 07/31/2007 7004
Filer:
EIN: 11-0000050 Name: RedesignComp, Inc Name Control: REDE Address: 55 Any Street Anytown, MI 49261 200707
Tax Year:
Binary Attachment Count: 0
IRS PAYMENT: None
RedesignComp, Inc.
11-0000050
Form 7004 Test #5
(Code 34 = Form 1120-C)
Application for Automatic 6-Month Extension of Time to File Certain Business Income Tax, Information, and Other Returns
TY 2006
Name: RedesignComp, Inc. Taxpayer identification number: 11-0000050 Number, street, and room: 55 Any Street City or town, State, Zip code: Anytown, MI 49261 Line Description Line Amount / Information Code for type of return for 6-mos ext 1 Org does not have office in US 2
checkbox
Write-in / Literal 34
3 4a 4b 5 6 7 8
Qualify under Sec 1.6081-5 checkbox Calendar yr or other year beginning and ending Short TY < 12 months check reason Corp and com parent of consolidated
grp
August 1, 2006 July 31, 2007
Tentative total tax Total payments and credits Balance due. Subtract line 7 from line 6
10,000 9,000 1,000