Cost for K1s for a partnership under 10 investors

[John Blanton]

I am working on getting quotes from a CPA for preparing K1s for a small partnership deal with less than 10 investors. 3 GPs and 7 LPs. I have been quoted $2500 by a local CPA, but some people have told me that seems high. Another colleague said $1k for K1s for 2 investors. Hoping economies of scale can help alleviate the cost a bit, so $2500 for 10 doesn't seem bad. Any assistance is appreciated!

[Kory Reynolds]

The number of K-1s may not be near as important as the terms of the partnership agreement, operations and clean books of the entity. IE if all 10 partners receive a straight 10%, would be alower fee than if there are special allocations of any kind.

Without knowing any other information, at the firm I am at, $2,500 would be a reasonable fee for a real estate property with 10 partners. If there were any special allocations, preferred returns, subject to business interest expense limitations, etc, depending on complexity could go up to $5k+.