When do partners receive their K-1s?

We target delivering K-1s well ahead of the March 15 partnership filing deadline so partners have time to use them for their own individual returns or extensions. Delays are usually caused by incomplete year-end information, which we flag early to avoid holding up the schedule.

What happens when a partner leaves during the year?

We allocate the tax year between the period before and after the departure using either an interim closing of the books or a proration method, whichever your agreement specifies or fits the facts better. This ensures income is attributed to the correct partner for the period they actually held their interest.

What is a tax basis capital account and why does it matter?

It is the IRS-required method for tracking each partner's investment in the partnership using tax rather than book values, and it directly determines whether a partner can deduct a loss allocated to them. If capital accounts are not maintained accurately, a partner's losses can be improperly limited on their individual return.

Do you handle multi-member LLCs, or only partnerships?

Yes, a multi-member LLC that has not elected corporate taxation is taxed as a partnership by default, and we prepare its Form 1065 and K-1s the same way. The LLC structure does not change the underlying partnership tax rules.

Business Tax Services

Partnership Tax Services in Clovis, CA

Form 1065 preparation, accurate K-1s, and buy-in accounting for two-owner shops, like a pair of electricians or plumbers who own the business together.

Built for HVAC, plumbing, electrical, and mechanical contractors running trucks, techs, and service agreements out of QuickBooks Online, ServiceTitan, and Housecall Pro.

Schedule Your Free Strategy Call (559) 203-3450

What sends contractors looking for this

Two electricians co-own the shop and their K-1s never match what they actually took home

When two owners run a shop together, their operating agreement usually spells out how profit gets split, and it is rarely a flat fifty-fifty once you add guaranteed payments for the partner who runs the field crews, a different split for the partner who handles the office, or a change in ownership percentage partway through the year. If ServiceTitan job costing and the bookkeeping do not track those details cleanly, the math behind each partner's K-1 gets tangled fast.

One partner ends up looking at a K-1 that does not match what actually landed in his bank account all year, and once that happens once, both partners start double checking every number instead of trusting the return.

A K-1 that one partner has already used to file his personal return requires both an amended partnership return and an amended personal return to fix, which typically costs several hundred dollars in additional preparation fees and can delay a refund the partner was counting on by months.

One electrician is buying into the shop and we do not know what that does to our taxes

When a second electrician buys into a shop that was previously owned by one person, or an existing partner buys out the other, the tax year has to be split between the period before the buy-in and the period after it, using either a closing of the books on that date or a proration formula. Get this wrong and you can shift a chunk of income onto the wrong partner's personal return.

A buy-in also usually changes what each partner's basis is, meaning how much of the business each partner has invested for tax purposes, and can trigger a technical termination of the old partnership if the ownership shift is large enough. Both of those need to be worked out at the closing table, not the following March.

Misallocating income around a buy-in date can shift several thousand dollars of tax liability from the outgoing owner onto the incoming owner or the other way around, and once both partners have already filed personal returns off the wrong numbers, fixing it means amending both returns and often an awkward conversation about who owes who money.

We are not sure each partner's basis in the shop is tracked correctly

The IRS requires each partner's capital account, meaning their running investment in the business for tax purposes, to be tracked on the tax basis method. Two-owner trades shops that started out tracking this loosely, or not at all, in QuickBooks often have no clean number for what each partner has actually put in versus taken out over the years.

That gap does not go away on its own. It grows every year the return gets filed without someone sitting down and reconstructing the contributions, distributions, and allocated profit for each partner from the beginning.

If a partner's basis is understated, a loss allocated to him on the K-1 can be disallowed on his personal return until basis catches up, and rebuilding years of capital account history after the fact typically costs several times more in preparation time than tracking it correctly each year would have.

How we fix each of those

01
K-1s built from your actual partnership agreement every March
Each year before the March 15 filing deadline we prepare K-1s directly from the allocation and guaranteed payment terms in your partnership agreement, cross-checked against ServiceTitan or Housecall Pro job data, so each electrician's share matches what the agreement actually says he is owed.
02
Buy-in and buyout accounting handled at closing, not at filing
When a partner buys in or is bought out, we calculate the interim closing or proration split at the time of the transaction, work out the basis adjustment for both partners, and check for a technical termination, so the deal is booked correctly in QuickBooks the same week it happens instead of guessed at during tax season.
03
Tax basis capital accounts maintained year over year
We track each partner's capital account on the required tax basis method every year as part of the annual return, and for shops with prior history we run a one-time reconciliation back to the partnership's start so both partners have an accurate basis number going forward.

Everything included

Form 1065 preparation and filing
Partner K-1 preparation and delivery
Special allocation calculations per the partnership agreement
Tax basis capital account tracking
Partner buy-in and buyout accounting
Guaranteed payment calculations
Section 754 election analysis when applicable
State partnership filing compliance

Work that pairs with this

Business Tax Preparation

Accurate, on-time federal and state returns for HVAC, plumbing, and electrical S corps and LLCs, built from books that already match your ServiceTitan or Housecall Pro job data.

View Business Tax Preparation

S Corporation Tax

Form 1120-S preparation, an owner salary number that holds up, and election upkeep for HVAC, plumbing, electrical, and mechanical shops running through ServiceTitan or Housecall Pro.

View S Corporation Tax

Multi-State Tax

A plain answer on what a job across the state line actually triggers, apportionment done right, and coordinated filing everywhere your crews work.

View Multi-State Tax

Contractors who have already done this

Real Google reviews from owners we work with, next to the engagements behind the numbers.

Google review
As a home services company, I feel that High Velocity Accounting has elevated our business to the next level. We are able to dig deeper into our numbers, report accurately and make adjustments where needed. They are very responsive, detail oriented and an extension of our team.
Cathleen Helin
Owner, Home Services
Clovis, CA
Case study
How a Construction Company Cleaned Up Two Years of Books and Financed New Equipment
Construction · $2.8M - $4.1M annual revenue
Books brought current
22 months
Equipment loan approved
$680,000
Read the full breakdown
Google review
I have been so genuinely pleased with High Velocity Accounting's services. I feel I have an extension of our team in Brett and his team. They always make time for my questions and look for strategic ways to build our businesses mutually. I rest easy knowing our books are kept in good order and our taxes are prepared professionally. I never hesitate to recommend this firm to any service business owners looking for professional book keeping and tax services.
Texas Medley
Owner, Service Contracting
Clovis, CA
Google review
We have been using High Velocity Accounting for a couple years now and are so thankful for their service! They are meticulous, thorough, dependable and always ready to deal with a curveball. Kind, patient, gracious. Thank you for your service and the relationship we've developed together.
Grant Schoenberger
Client, Trades
Clovis, CA
Google review
Brett Neal has been our family's accountant for over six years now, because he is the most dependable professional in this business. We started with Brett as two separate single-filers with simple W-2's and quickly graduated to a married couple having multiple types of complicated business/tax filings. Brett took every shift in stride; every transition has been carried out smoothly and without any hiccups. Trust that this is the guy for all your filing, bookkeeping, and financial consulting needs.
Alyssa Cotrina
Business Owner, Trades
Clovis, CA

Where we do this work

Our office is in Clovis and we work with home services contractors across the Central Valley and nationwide. Pick your city to see how partnership tax works for shops in that market.

Not on the list? We run every engagement over QuickBooks Online, ServiceTitan, and Housecall Pro, so distance does not change the work. Call (559) 203-3450.

Talk to a CPA who will actually pick up the phone

Start with a 30-minute consultation at no cost. You will leave it knowing what the work involves, what it costs, and what happens next.