! Required information (The following information applies to the questions displayed below.) Aaron, Deanne, and Keon formed the Blue Bell General Partnership at the beginning of the current year. Aaron and Deanne each contributed $109,000 and Keon transferred an acre of undeveloped land to the partnership. The land had a tax basis of $71,000 and was appraised at $180,000. The land was also encumbered with a $71,000 nonrecourse mortgage for which no one was personally liable. All three partners agreed to split profits and losses equally. At the end of the first year, Blue Bell made a $6,600 principal payment on the mortgage. For the first year of operations, the partnership records disclosed the following information: Sales revenue Cost of goods sold Operating expenses Long-term capital gains $1231 gains Charitable contributions Municipal bond interest Salary paid as a guaranteed payment to Deanne (not included in expenses) $ 480,000 450,000 56,000 2,400 900 300 300 3,000 C-1. Using the information generated in answering parts (a) and (b), prepare Blue Bell's page 1 and Schedule K to be included with its Form 1065 for its first year of operations. c-2. Using the information generated in answering parts (a) and (b), prepare a Schedule K-1 for Deanne. Visit the IRS website and download Form 1065 Schedule K-1. Enter the required values in the appropriate fields. Save your completed Tax Form to your computer and then upload it here by clicking "Browse." Next, click "Save." Form 1065 20 U.S. Return of Partnership Income OMB No. 1545-0123 For calendar year 2021, or tax year beginning ,2021, ending Department of the Treasury 2021 Internal Revenue Service Go to www.irs.gov/Form 1065 for instructions and the latest information. Principal business activity Name of partnership D Employer identification number Blue Bell's Principal product or service Type Number, street, and room or suite no. If a P.O. box, see instructions. E Date business started or C Business code number Print City or town, state or province, country, and ZIP or foreign postal code F Total assets (see instructions) $ G Check applicable boxes: (1) Initial return (2) Final return (3) Name change (4) Address change (5) Amended return HCheck accounting method: (1) Cash (2) Accrual (3) Other (specify) Number of Schedules K-1. Attach one for each person who was a partner at any time during the tax year J Check if Schedules C and M-3 are attached K Check if partnership: (1) Aggregated activities for section 465 at-risk purposes (2) Grouped activities for section 469 passive activity purposes Caution: Include only trade or business income and expenses on lines 1a through 22 below. See instructions for more information. 1a Gross receipts or sales. 1a b Returns and allowances 1b 480,000 c Balance. Subtract line 1b from line 1a. 1c 480,000 2 Cost of goods sold (attach Form 1125-A) 2 450,000 Gross profit. Subtract line 2 from line 10 3 Ordinary income (loss) from other partnerships, estates, and trusts (attach statement) 4 5 Net farm profit (loss) (attach Schedule F (Form 1040) 5 6 Net gain (loss) from Form 4797, Part II, line 17 (attach Form 4797) 6 7 Other income (oss) (attach statement) 7 Total income (loss). Combine lines 3 through 7 8 9 Salaries and wages (other than to partners) (less employment credits) 9 10 Guaranteed payments to partners 10 11 Repairs and maintenance. 11 12 Bad debts 12 13 13 14 Taxes and licenses 14 Income 3 4 WN 8 ructions for limitations) Rent 55 1 / 5 100% + 8 N- Rent. Deductions (see instructions for limitations) S 8 Total income (loss). Combine lines 3 through 9 Salaries and wages (other than to partners) (less employment credits) 9 10 Guaranteed payments to partners 10 11 Repairs and maintenance. 11 12 Bad debts 12 13 13 14 Taxes and licenses 14 15 Interest (see instructions) 15 16a Depreciation (if required, attach Form 4562) 16a b Less depreciation reported on Form 1125-A and elsewhere on return 16b 16C 17 Depletion (Do not deduct oil and gas depletion.) 17 18 Retirement plans, etc. 18 19 Employee benefit programs 19 20 Other deductions (attach statement) 20 21 Total deductions. Add the amounts shown in the far right column for lines 9 through 20 21 22 Ordinary business income (loss). Subtract line 21 from line 8 22 23 Interest due under the look back method-completed long-term contracts (attach Form 8697). 23 24 Interest due under the look back method-income forecast method (attach Form 8866) 24 25 BBA AAR imputed underpayment (see instructions) 25 26 Other taxes (see instructions) 26 27 Total balance due. Add lines 23 through 26 27 28 Payment (see instructions) 28 29 Amount owed. If line 28 is smaller than line 27, enter amount owed 29 30 Overpayment. If line 28 is larger than line 27, enter overpayment 30 Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than partner or limited liability company member) is based on all information of Sign which preparer has any knowledge. Here May the IRS discuss this return with the preparer shown below? See instructions. Yes Signature of partner or limited liability company member No Date Paid Print/Type preparer's name Preparer's signature Check self-employed Preparer Firm's name Firm's EIN Use Only Firm's address Phone no. For Paperwork Reduction Act Notice, see separate instructions. Cat. No. 113902 Form 1065 (2021) Tax and Payment Date if PTIN Page 4 Total amount 1 2 3a 3b c Income (Loss) 4c 5 7 8 9a Form 1065 (2021) Schedule Partners' Distributive Share Items 1 Ordinary business income (loss) (page 1, line 22) 2 Net rental real estate income (loss) (attach Form 8825) 3a Other gross rental income (loss).. b Expenses from other rental activities (attach statement) c Other net rental income (loss). Subtract line 3b from line 3a 4 Guaranteed payments: a Services 4a b Capital 4b c Total. Add lines 4a and 4b 5 Interest income 6 Dividends and dividend equivalents: a Ordinary dividends b Qualified dividends 6b c Dividend equivalents 7 Royalties 8 Net short-term capital gain (loss) (attach Schedule D (Form 1065)). 9a Net long-term capital gain (loss) (attach Schedule D (Form 1065)) b Collectibles (28%) gain (loss). 9b c Unrecaptured section 1250 gain (attach statement) 9c Net section 1231 gain (loss) (attach Form 4797). 11 Other income (loss) (see instructions) Type 12 Section 179 deduction (attach Form 4562) 13a Contributions b Investment interest expense c Section 59(e)(2) expenditures: (1) Type (2) Amount d Other deductions (see instructions) Type 14a Net earnings (loss) from self-employment. b Gross farming or fishing income. c Gross nonfarm income 15a Low-income housing credit (section 420)(5)) b Low-income housing credit (other) c Qualified rehabilitation expenditures (rental real estate) (attach Form 3468, if applicable) d Other rental real estate credits (see instructions) Type e Other rental credits (see instructions) Type f Other credits (see instructions) Type 10 10 11 12 13a 13b Employ- Deductions Self- ment 13c(2) 13d 14a 14b 14c 15a 15b 15c 15d 15e 15f Credits onal tions 16 Attach Schedule K-2 (Form 1065). Partners' Distributive Share Items-International, and check Self- Employ- ment C 14a 14b 14c 15a 15b 15c 15d 15e 156 Credits 14a Net earnings (loss) from self-employment . b Gross farming or fishing income. Gross nonfarm income 15a Low-income housing credit (section 420)(5)) b Low-income housing credit (other) c Qualified rehabilitation expenditures (rental real estate) (attach Form 3468, if applicable) d Other rental real estate credits (see instructions) Type e Other rental credits (see instructions) Type f Other credits (see instructions) Type 16 Attach Schedule K-2 (Form 1065), Partners' Distributive Share Items-International, and check this box to indicate that you are reporting items of international tax relevance. International Transactions Alternative Minimum Tax (AMT) Items 17a Post-1986 depreciation adjustment b Adjusted gain or loss c Depletion (other than oil and gas) d Oil, gas, and geothermal properties - gross income e Oil, gas, and geothermal properties - deductions f Other AMT items (attach statement). 18a Tax-exempt interest income b Other tax-exempt income c Nondeductible expenses 19a Distributions of cash and marketable securities b Distributions of other property 20a Investment income b Investment expenses c Other items and amounts (attach statement) 21 Total foreign taxes paid or accrued 17a 17b 17c 17d 17e 176 18a 18b 18c 19a 19b 20a 20b Other Information 21 Form 1065 (2021)