Enter special allocations for partners

A partnership agreement can require an item to be allocated amount the partners in a different manner than the default method. You can accomplish this by creating a special allocation.
The default allocation method for the entire partnership uses the partners' profit ratio to allocate distribute items that aren't specially allocated. The ratio's calculated from the beginning partner ratio information entered for each partner. If no ratios are entered, the system computes beginning ratios based on the amount entered for each partner's beginning capital balance. Allocation defaults can be changed, if needed, in
Organizer
,
General Information
,
Return and Print Options
,
Allocations Options
.
To specially allocate items to partners, follow these 2 steps.

Step 1 - Create and assign special allocation code

  1. Go to
    Organizer
    ,
    Partner Information
    ,
    Allocations
    , and then
    Special Allocations
    .
  2. Select
    Add new Special Allocation Code
    .
  3. Enter a 2-character code. You can use any 2 alphanumeric characters, such as RR, as long as it doesn't begin with a zero.
  4. Select
    Save
    . Your code now appears in the Special Allocations section.
  5. Next, enter a description in the
    Description (Mandatory)
    field.
  6. Select one of these options to allocate any remaining amounts not specifically allocated:
    1. Residual
      - The system allocates the remaining balance of the item to the partners who aren't involved in the special allocation based on their default ratios, excluding the ratios of the partners already receiving special allocations.
    2. Piggyback
      - The system allocates the residual balance of the item to all partner based on their default ratios.
  7. Enter either ratios or dollar amounts, but not both. To allocate zero, enter NONE.

Step 2 - Enter special allocation

  1. Go to
    Organizer
    ,
    Ordinary Income and Deductions
    , and then
    Income Summary
    .
  2. Enter your special allocation code in the
    Alloc Code
    fields you want to specially allocate.
  3. You can review the amount specially allocated by going to the form and line item in
    Tax Forms
    , right-clicking for the context menu, and selecting
    Allocation Display
    .

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