Borrower’s Proportionate Share of Income or Loss
The borrower’s proportionate share of income or loss is based on the borrower’s partnership percentage of Ending Capital in the business as shown on IRS Form 1065, Schedule K-1.
The lender can only consider the borrower’s proportionate share of the business income or loss after making the adjustments to the business cash flow analysis.
For additional information, see B3-3.4-01, Analyzing Partnership Returns for a Partnership or LLC.