You entered the balance sheet. You entered the partners' capital. Then you print the return and Schedule L isn't there. Neither is M-1 or M-2, and item L on every K-1 is blank.
Nothing is broken. UltraTax CS decided the partnership doesn't have to file them, and it decided that based on an answer you may not remember giving.
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The answer that turns them off
Schedule B, question 4. UltraTax CS omits Schedules L, M-1 and M-2, the total assets figure on page 1, and item L on the K-1s when all four of these are true:
Total receipts for the year under $250,000. Total assets at year end under $1 million. Schedules K-1 filed timely with the partners. No Schedule M-3 filing requirement.
Meet all four and the software answers question 4 yes and stops producing the schedules, because at that point the IRS doesn't require them. It's doing what it was designed to do. It just does it silently, which is why the first reaction is usually that something has gone wrong with the data entry.
Where the field is
General folder, OthInfo screen, in a field called "Meet all requirements for Question 4? (Force)".
It takes a code. Code 1 is yes, which omits the schedules. Code 2 is no, which forces the total assets figure on page 1 along with Schedules L, M-1, M-2 and the K-1 detail.
So if you want the schedules, enter 2 and they appear. That's the answer you'll find on most forums, and it works.
It's also, quite often, the wrong thing to do.
Why forcing a "no" is not the right fix
Question 4 is a question on the tax return. If the partnership genuinely meets all four conditions, then the true answer is yes, and forcing a 2 makes the return say no.
That's not a display setting. You've changed a representation on a filed return to get a schedule to print. Nobody is going to lose sleep over it, but it's the wrong tool, and there's a right one sitting next to it.
The field you actually want
Still on the OthInfo screen, there's a separate field: "Print schedules when not required."
Code 1 prints Schedule K-1 item L along with Schedules L, M-1 and M-2. Code 2 prints only item L on the K-1s.
Question 4 keeps its honest answer of yes, and you get the schedules anyway. That's the distinction worth knowing, and it's the reason to spend a minute on this field rather than reflexively forcing the question.
Use code 2 when you want the partner capital detail without the full balance sheet package. Use code 1 when you want everything, which for most engagements is the right call.
Item L is not optional the way the rest is
Worth separating two things that get run together.
Question 4 relieves the partnership of Schedules L, M-1 and M-2. It does not relieve anyone of reporting each partner's capital account on tax basis in item L of the K-1. That reporting requirement stands on its own, which is exactly why UltraTax gives you a print option that produces item L by itself.
If item L isn't calculating at all, check two things. First, the diagnostics, which will usually tell you what's missing. Second, question 4, because a yes answer suppresses it along with everything else.
Why to print them even when nobody makes you
The strongest argument is the beginning column next year.
A return that proforma'd from a completed prior year carries the balance sheet forward on its own. Skip a year and there's nothing to carry. Skip three and someone has to rebuild the equity section from records the client may not have anymore, usually at the worst possible moment, which is when the partnership crosses a threshold after a good year, or a partner leaves, or the business sells.
Twenty minutes now against a weekend in four years is not a close call. The partnerships that stay under the thresholds are also the ones with the least reliable bookkeeping, which is the other half of the argument.
Doing the balance sheet work outside the return
The schedules printing is the easy part. Having something worth printing is the work, and that happens before UltraTax opens.
Ledger IQ takes the trial balance the client sent and maps each account to an actual line on the return, so the balance sheet is built from the books rather than typed in from them. Adjusting entries post with references and show up in the adjustments column, so every figure on Schedule L traces back to something. Book to tax items post separately as tax journal entries with their own M-1 and M-2 offset rows, which keeps the book column true to the client's financial statements while the difference is still tracked where Schedule M-1 wants it.
Schedule L beginning balances can be entered as an optional check. Enter them and the workpaper tests them against what the prior year should have produced, which is how you catch a balance that has been carried forward faithfully and wrongly for several years.
Having a balance sheet worth printing
- Upload the trial balance and map the balance sheet accounts to their Schedule L lines.
- Enter the beginning balances as the optional error catcher, so a figure that stopped being right several years ago gets caught now.
- Post the adjusting entries the books are missing, each with a reference, so every figure on Schedule L traces back to something.
- Record book to tax items as tax journal entries with their own M-1 and M-2 offset rows, keeping the book column matching the client financial statements.
- Confirm every column foots in the Working Trial Balance and that the income proof ties.
- Download the workpaper as Excel or PDF for the file. This matters most on the returns where question 4 says the schedules are not required, because you keep a proper balance sheet for next year even when the return does not print one.
- Export to UltraTax CS with the schedules turned on using the print option rather than a forced question 4.
Supports Forms 1065, 1120S and 1120, with exports for Drake, Lacerte and UltraTax CS. The walkthrough is in the UltraTax CS resource guide, and it is free during early access, so you can start at portal.ledgeriq.ai and run this on a live client without a credit card.