Partnership return.

R&J Business Consulting, LLC, is a cash method, calendar year LLC. The LLC advises businesses on various issues such as start-up, expansion, location, advertising, etc. Roger and Jennifer are equal owners of the LLC (i.e., they share all profits and losses 50% each), and they are active in the business. The LLC is treated as a partnership for federal income tax purposes. The LLC was organized and started doing business on May 11, 2015. The following occurred during the year.

Gross consulting revenue $320,000

Tax exempt interest income 2,000

Employee wages 100,000

Guaranteed payment to Roger 60,000

Guaranteed payment to Jennifer 70,000

Rent expense 30,000

Charitable contribution 4,000

The LLC distributed $40,000 cash to Roger and $40,000 cash to Jennifer during the year. At the beginning of the year, the LLCs balance sheet showed the following:

Assets:

Cash $280,000

Tax exempt securities 40,000

Total assets $320,000

Liabilities:

Nonrecourse liability $20,000

Owners Equity (Capital):

Roger $150,000

Jennifer $150,000

Total liabilities and capital $320,000

At the end of the year you can assume the tax-exempt securities are still on the books at $40,000 and the liabilities are $19,000 (the LLC paid down the liability by $1,000).

The LLC does not have a Section 754 election in effect. It did not make any payments requiring it to file a Form 1099. The LLC has no foreign bank accounts or investments and has conducted no foreign activities. The LLC did not engage in nor advise others regarding reportable transactions. The LLC files its return with the IRS Center in Ogden, Utah. (Note: It is ok to leave blank any items of information that the return asks for that I did not provide you.)

Complete Form 1065 and a Schedule K-1 for each partner. Assume the business code number is 541990. The LLCs employer identification number is 12-3456789. The LLCs address is 8888 Lambert, Los Angeles, CA 99999. Roger (SS# 555-55-5554) lives at 222 Independence Circle, Los Angeles, CA 99999. Jennifer (SS# 444-44-4443) lives at 444 Liberty Way, Los Angeles, CA 99999.

You may complete the tax return in pencil, pen, or by using a fill-in form where you type your answers directly on the form. Using any type of tax preparation software is not allowed.