step-up

[cat1]

How does the partnership do the step-up? I'm sorry if that's a basic question as I haven't done any partnership returns before. My client just inherited a 50% share in a partnership. The other partner is the one who has been preparing the partnership return, but is not a tax preparer, and has always just stuck to the basics. I was thinking we would start the depreciation over on my client's personal return but had not yet found out how to do that. All assets had been previously fully depreciated. Does partnership start depreciation over again on inherited 1/2?

Thanks

Under Code section 754, but must be elected on a timely basis by the partnershp. On the partnership level the accounting for this is a abit messy. Your question, is not basic, is reasonable unlike many ignorant or lazy others, so called tax prepares. Hint: its all done on the partnership level.

[kcjenkins]

Yes, the whole amount flows to the Sch E, page 2. Then you can add another column on the K-1 Input sheet, where you put the same EIN and name, but put any special adjustment that the particular partner has. Just like you do to add UPE.

[Kea]

Thanks so much. I really appreciate everyone's help, suggestions and input.