Does Quicken 2012 Work for a Partnership? - dummies

Does Quicken 2012 Work for a Partnership?

By Stephen L. Nelson

A partnership that uses Quicken 2012 faces the same basic problem as a corporation that uses Quicken. In a partnership, the partners want to track their partnership capital accounts (or at least they should). A partnership capital account simply shows what a partner has put into and taken out of a business.

Quicken calculates a net worth figure for you by subtracting total liabilities from total assets. So, to the extent that your total assets and total liabilities are accurately accounted for in Quicken, you know roughly the total partnership capital.

To solve this problem, you (or someone else) need to track what each partner puts into the business, earns as a partner in the business, and then takes out of the business. You can also just use the Quicken loan accounts for partnership equity accounts.

You just need to not get freaked out when your net worth shows as zero, and you need to remember that the partnership equity accounts aren’t really loans — they’re capital.

One other thing to think about here concerns your partnership tax return. If your partnership books revenue of $250,000 per year or more or owns assets that total $650,000 or more, you will need to include a balance sheet with your partnership tax return.

Quicken isn’t very good about creating the sort of balance sheet that needs to get included with a tax return. Accordingly, if your partnership grows so that its revenues equal or exceed $250,000 or so that its assets equal or exceed $650,000, consider upgrading to QuickBooks.