Filing an extension is definitely easier than amending a return later. An extension is very simple to file (Form 4868) and gives you until October 15 to submit your final return. Just remember that an extension gives you more time to file, not more time to pay. You'll need to estimate what you owe and pay that amount by the April deadline to avoid penalties. If you're expecting K-1 income, make a reasonable estimate based on previous years or any information you have about the current year. It's better to slightly overpay and get a refund later than underpay and owe penalties.

Definitely go with the extension if you know a K-1 is coming late! I learned this the hard way after amending returns multiple times. Filing an extension is literally a 5-minute online process, while amending a return can take weeks to prepare and months to process. One thing to add to what Natalie said - if you've received K-1s from the same partnerships in previous years, you can use that income as a baseline for estimating your payment. Most partnerships have relatively consistent distributions year over year, so last year's K-1 income is usually a decent approximation for your extension payment calculation. @f014fc63b237 is spot on about the payment timing - the extension only extends your filing deadline, not your payment deadline.

This spreadsheet approach is brilliant! I wish I had thought of this years ago. I'm definitely going to start tracking this data going forward. Quick question - do you also track whether the K-1s from each partnership tend to have corrections or amended versions? I've had a couple partnerships send out corrected K-1s weeks after the original ones, which threw off my whole filing timeline even more. Also, I had no idea some brokerages were adding K-1 warnings - that's such a helpful feature. I'm with TD Ameritrade and haven't noticed this yet, but I'll definitely look more carefully at my account interface. Might be worth switching brokerages just for better K-1 management tools at this point!

Wouldn't the approach of not reporting as a guaranteed payment cause other issues though? Like wouldn't it mess up the partner's self-employment tax calculation? The guaranteed payment affects both SE tax and QBI.

You're absolutely right - that workaround would indeed cause SE tax issues by understating the guaranteed payments subject to self-employment tax. I shouldn't have suggested that approach. The correct method is definitely to report the health insurance as a guaranteed payment on the 1065 and then override the QBI calculation on the 1040 to prevent the double reduction. It's frustrating that we have to manually fix software issues, but at least it's a straightforward override.

I'm new to dealing with partnership returns and this thread has been incredibly helpful! I've been struggling with this exact issue for a client and wasn't sure if I was missing something or if it really was a software bug. It's reassuring to hear that experienced practitioners are seeing the same problem across multiple platforms. I was hesitant to override the QBI calculation without being 100% certain, but the consensus here gives me confidence to make the adjustment. One quick question - when you're documenting the override, are you just adding a note in the software or are you creating a separate memo to attach to the return? I want to make sure I'm properly supporting the position in case of any IRS questions down the road.

I use H&R Block software and it actually has a specific section for "payment in kind" or non-cash rental income. You just enter it as additional rental income and then also create a corresponding expense entry. Much clearer than TurboTax in my experience.

Great question about the 1099 requirements! Yes, you would typically need to issue a 1099-NEC to your tenant if the total value of services exceeds $600 for the year. In your case with $150/month for snow removal over several months, you'd definitely hit that threshold. For documentation, I'd strongly recommend having your tenant provide some form of written record of the services performed - even if it's just a simple monthly statement listing dates and work completed. You don't necessarily need formal invoices, but having documentation that shows the work was actually performed and when will be crucial for audit protection. You might also want to take photos of the completed work (cleared driveways, walkways, etc.) and keep those with your records. The IRS likes to see that claimed expenses are legitimate business expenses, so having proof the work was actually done helps justify both your income reporting and expense deduction. One more tip - make sure your lease agreement or a written addendum documents this arrangement. Even though informal agreements still need to be reported correctly, having it in writing makes everything much cleaner from a tax perspective.

Same thing happened at my retail job! New payroll system last spring and now most of my coworkers owe money. Our manager told us it was because the new system "more accurately calculates withholding" but nobody explained we needed to adjust our W-4s.

Wait, Wells Fargo gave you an early deposit?! That's crazy, they NEVER do that! Gives me hope that maybe the banks are just processing things differently this year. I'm also with PNC and still waiting - maybe they're just running behind their usual schedule. Thanks for the update, definitely keeping my fingers crossed it hits before the end of the day!

Same here! PNC with DDD 3/14 and still nothing as of 5:30pm. Filed on 1/27 and got accepted the same day. This is nerve-wracking since PNC is usually so reliable with the 2-day early deposits. But you're right, seeing Wells Fargo customers getting theirs today when they normally don't do early deposits makes me think maybe all banks are just processing things differently this year. The 846 code on my transcript is definitely reassuring though - at least we know the IRS has sent the payment! I'm going to try not to check again until around 8pm. Hope we all see our deposits hit tonight!