What is a Schedule K-1 Form?

If you are an owner of a partnership, LLC, S-corp, or other entity that passes through taxes to its owners, in most cases you will receive a K-1 form each year. The K-1 is prepared by the entity to distribute to owners/shareholders to outline their portion of the income, loss, and deductions. Similar to a 1099 form received that highlights contractor income, you do not have to file the K-1 with your personal income tax return. Instead, you use the data on the form to fill out portions of your personal tax return.

Preparing a K-1 For Shareholders

While a K-1 form is easy if you’re just the recipient needing to record income or losses, the process is a bit more detailed for owners of an S-corp, LLC, or partnership who are responsible for distributing the K-1 forms to members. Not only do you need to report net profit or loss, but some financial data must be tracked individually.

The S-corp or partnership must report certain income and expenses separately from the net profit or loss amount. These income and expense items retain their tax characteristics when passed-through to the shareholder, and are subject to the limits and tax rates on each shareholder’s personal Form 1040. Separately stated items are the following:

  • Section 1231 gains and losses,
  • Net short-term capital gains and losses,
  • Net long-term capital gains and losses,
  • Dividends eligible for the dividends received deduction (if a shareholder is a C-Corporation),
  • Charitable contributions,
  • Taxes paid to a foreign country,
  • Tax-exempt interest and related expenses,
  • Investment income and expenses,
  • Amounts previously deducted, such as bad debts,
  • Real estate income and expenses,
  • Section 179 deductions,
  • Tax credits, and
  • Non-deductible expenses, such as 50% of meals and entertainment expenses.

In addition, you must send out your K-1 forms to shareholders by March 15th.

The Unexpected K-1

Obviously, if you’re an active member in a partnership or other business that regularly issues K-1s it will come as no surprise when you receive one each year. But there are situations where you may appear to get a K-1 out of the blue, and this can throw you for a loop.

When this happens it’s almost always due to an investment in an ETF or fund that’s operating as a limited partnership. This isn’t always obvious to a regular investor, but buying shares of a commodity fund may in fact make you a part owner of a partnership. That means at the end of the year you’ll receive a K-1 outlining your share of the partnership’s profit or loss. This can come as quite a surprise for a new investor.

One way to tackle this issue is to hold your ETFs or other investments that are limited partnerships inside an IRA. You’ll still get a K-1 at the end of the year, but the taxes are still deferred and it won’t require any additional tax calculations on your end. If you’re holding these in a taxable account, though, it’s a good idea to use good tax preparation software that will guide you through the process. Here’s what Forbes has to say about how TurboTax handles K-1 forms.

Comments (137) Leave your comment

  1. If a single member LLC issues a k-1 to the single member as guaranteed payments and this is the only income for the business, does the LLC still need to file a 1065 return?

  2. Is a foreign company obligated by the IRS to send a form k-1 to an investor who is a US citizen?

  3. I have investments in about 20 publically traded MLP’s, most in the energy sector. Will TurboTax handle these? Is there provision to enter carryforward info (such as passive losses) from prior years? Will Turbotax generate all of the necessary forms once the entries form the K-1s are, in turn, entered into the program? I just finished my return for this year, using a tax prep professional, and I am thinking about using TurboTax next year. Thanks.

  4. My 12 year old son has an investment in an MLP. He will be receiving a K-1. If his gains from the investment is less than $1,000, will he still have to file a return as a result of getting the K-1?
    Thank you,
    Alan

    • Hi Alan,
      If your son’s investment in an MLP is less than $1,000, he will not have to file a tax return unless he has other income that when added increase his income to over $1,000.

      Thank you,
      Lisa Greene-Lewis

  5. I received a K-1(1041) in 2014 as a beneficiary due to my fathers death in 2013. It is an 11 C. I received it from the fiduciary.
    We have already filed our 2013 taxes. What am I to do and how does this affect our 2013 taxes?

  6. I have about $14,000 invested in a piece of family property. I receive my K1 in the middle of the summer, so by then my taxes are done. This year I got one in time to do my taxes with it. My accountant at H&R Block told me that the fee for this raised my prep fee $200. I can’t understand why it cost that much to process. No gains or interest on my part. No I wonder why I should even include this since I haven’t done so since my money was invested in this property. I feel as though I should not include it in the future and risk a penalty, which would probably be less than the prep fee. Am I getting ripped off? Should I just throw this form away?

    • Hi Chuck,
      You should still file the form. The IRS will match up the form they receive from the payor and if it doesn’t match your tax return you may get an adjustment or notice from the IRS. Next time try TurboTax so you can save some money.
      Thank you,
      Lisa Greene-Lewis

  7. I own 100% of an LLC that I created several years ago. My LLC owns 1 rental property. I also own 4 other properties as a sole proprietor. I file a corporate return for my LLC every year and a personal return for the other 4 properties. Should I also have a K1 statement?

  8. I recently invested in a movie, and another business. Based on tax laws, sec 181, we qualify for a write-off. I also have invested in another business with depreciating assets.
    Therefore, I have received my K-1s and mostly losses are listed. The losses almost outweigh my wage income, but Turbo Tax doesn’t reflect this. Did I miss something when I invested in these businesses?

  9. My husband is a partner in an LLC which is strictly family business. He only gets a K-1 after the family CPA has filed his tax return for the previous year. Is that customary???

  10. I am completely new to the K-1 form and not sure if this has been answered or not, but I am a bit confused as the TurboTax form for the K-1 do not match the descriptions in the K-1. Specifically boxes 13-20 (with letters) On the K-1, I get something like 20J1, 2, 3, etc. and these don’t seem to match any Turbotax box descriptions. Any help?

  11. I am trustee for my brother’s special meets trust. MUST I or MAY I deduct all of the distributions on the 1041? If I do not claim all of the distributions, the trust would pay a higher tax rate on that portion of income (IRS should be happy). I get a simpler administration which should offset all or part of those extra taxes. I get conflicting opinions on this question. Coincidentally, I receive a distribution. My K-1 does not include all of the cash distributions for the year. This occurred two years in a row.
    MattJohn

  12. I filed my taxes last week. I just received a Schedule K-1 for a sale of ASQ which I didn’t realize used a K-1 instead of a 1099. It’s not listed as a MLP, LLP, etc. I entered it as a loss of $21 with the rest of my stock sales, about 30, on my taxes. What should I do, will the IRS notice my error? (I had a entered info for a K-1 I had for an MLP.) Thank you,

  13. This is my first year of owning shares of BX which issues a K-1. I know the amts of the partnership distribution. I don’t know the “tax character”. BX issues what they call preliminary information in late March. Will this have the tax character of the distribution? They won’t tell me now because it would constitute advice in their opinion.

  14. A foreign Company makes an investment in a Joint Venture drilling oil and gas wells. The foreign company get paid out from production and receives a K-1 at the end of the year. does the foreign company have to file a Federal & State Tax return, or may it claim that income in it;s country for tax purposes?

  15. My grandfather passed away and he left some 4 yards (one that has a building on it) to me and 2 other people. These yards are currently being rented out by businesses. We are trying to figure out how we are going to handle this from a tax aspect. We have opened up a business account where all funds are being deposited and setting some of the funds aside for property taxes and expenses. The rest of the funds will be split between the 3 of us quarterly. We have all agreed to pay our own taxes on the money that is distributed qtrly. Are we going about this in the right way and what do we do when tax time comes? Is it required that we pay qtrly taxes on the funds? Any advice is greatly appreciated. thanks in advance

  16. we have a rental property but it is not an LLC. Turbo Tax is telling me I need to upgrade from Premier to House and Business. Why, and do I have to, the rental property is not a business. Thanks!

  17. I have completed filing federal taxes for a trust established by my father-in-law that calls for income to be distributed annually. I am beginning to complete NC taxes for the same trust. Question: since much of the data for NC taxes comes from the fed form 1041, do I have to make additions or deductions, since all this was already “adjusted out” of the federal income?

  18. Last year my wife and I bought a rental property that we purchased under an LLC. We are equal partners but we always file Jointly. Do we need to file a K-1 form to each of us??

    • Hi Bob,
      Yes, you would need to do your business tax return first with TurboTax Business product and it will produce K-1s for each of you. Then you will use the K-1s on your personal tax return that you file jointly.
      Thank you,
      Lisa Greene-Lewis

      • Lisa, My HRBlock Basic program is having problems with Box 19 on the K1 and does not know how to handle it. Which TurboTax program will handle all aspects of the K1?

      • Hi Tom,
        You should use TurboTax Premier if it is a K-1 for distributions to you.
        Thank you,
        Lisa Greene-Lewis

  19. My husband’s aunt passed away in 2011 and he received a K-1 from the CPA, showing Line 11 A (Excess Deductions) and 11 C (Long term Capital Loss Carryover.) We were not comfortable showing a loss, since we really weren’t in on all the ins and outs of the estate, so we didn’t report it last year. This year, as I came to the end of our taxes, I received a message that the K-1 Form isn’t yet ready and can be emailed to me. Why is that populating when I didn’t report anything. Is it necessary for us to report this loss?

  20. I inherited a business. Which new partners took over but kept me on as a limited partner. They then bought out my share and sent me a K-1 showing a $40,000.00 loss. Previous years were 1500 or 799, but this one thru my accountant for a loop. What can I do. I would like to file it with my taxes this year. BTW the K-1 is from 2012, I received it on 9.15.2013.

  21. is k1 income can be used to negate personnel investment income loss?

    example $5,000 income on K1 can be used nullify $5,000 personnel investment loss

    if yes, are there any limits?

  22. I received a incomplete k-1 in March of 2013 because of missing trades. I filed for an extension(I have a total loss). Then in Sept 2013 I sent the partnership the missing trades and they e-mailed me the completed k-1 form. I asked if they were going to file my completed K-1 with the IRS?But told me they do not send k-1s to the IRS after June 1 because they already filed there taxes.Now do I file form 8082 with just the missing trades? (That is what they told me) But how will the numbers match up correctly with the IRS if the partnership never filed my completed K-1? Do I send the IRS the completed K-1?
    Thankyou in advance!
    Barron

  23. I was a partner in a company and left right before tax time, this was 2011…my partner said that she filed for the company but never sent me a k1 and will not give me copies of anything….

    • I could not agree with you more. Turbo Tax wants you to use their product, but for K-1’s the questions they ask are not totally understandable and I have never been able to get to anyone at Turbo Tax(A live person) to answer questions regarding K1’s.

    • Isn’t that the truth! I’ve not gotten an answer yet!! I too asked questions regarding K-1s no answer to date!

      • Thats because it is way too complicated. Lucky I made enough money on the stock BX to pay an accountant to figure it out. It is amazing people sit around and come up with all this stuff. I will be selling the stock this year and no more K1s starting next year!!

  24. I was a manager to an LLC until the members decided to assign the LLC last year over to the operator in lieu of refinancing a distressed RE property. The problem came about when our CPA had indicated he could only generate an estimate K-1 due to the operator refusing to give us the needed financials for our CPA. And one of the member’s CPA refuses to accept an estimate k-1. What are the risks involved with an estimate k-1? And what else can I do to resolve this issue?

  25. Hi Lisa:

    There had been calculation errors in my NJK1 which was audited for the year 2009. The deficiencies were paid off. Please advise how do I go about corrected my following years NJK1’s. Do I have to file the amended NJ1040X with the amended NJK1’s or should I just submit the NJK1 for 2010 thru 2012 to NJ Div. Thanks in advance

  26. my wife just got hired at a new salon. and they want to give her a k1 instead of a w2 . she works on 50% commission, not both rental they also want her to sing a non compete clause .they make the schedule tell her when she can take vacation and can fire her when ever they want , this seams like an employee situation not a partner she should get a w2 is this a legal business practice.

  27. My children have a trust account from the death of their father and are now members of an LLC. The LLC receives rental income from a billboard but the children receive no profits only a K1 showing they received income when they actually never have. What should I do and is this lawful?

  28. I receives a k-1 for one of the stocks I brought nth. I have a loss of -3. The state tax table on the k-1 shows three states with no income for 2 and one state with the loss. Should I be filling returns to all the three states for the partnership. Any guidance would be good. I am not getting good info on it.

  29. I am involved in an S-Corp. We have been an S-Corp for more than 15 years. Each and every year, my partner who handles the books, would complete corporate taxes and personal taxes and provide us with payment to the IRS for our financial share. As of a week ago, after some strife internally, refused to provide any financial information, K-1 or advise me on what is due for our Federal Income Tax and my liability (paid by company) is to the IRS as in the past. He would normally issue a check to us, and write on our account to the IRS. Now I am in a bind for filing Monday. Do I file an extension only? Do I file an extension of what might be due and not pay it? Suggestions please.

  30. I received a K1 form after I filed my taxes for 2012. The amount show a slight loss. Do I have to amend my taxes? I don’t believe the refund would be much and I prefer to just let it go unless I can be in trouble. Please advise.

    • You shouldn’t be in big trouble. I say this not knowing the amounts however. You should be fine. The IRS doesn’t usually go after people for paying too much taxes. If it does come up, simply explain to them what happen, and they will fix it for you. Because you say it is a small amount, I would not pay to have a amended return done.

  31. Hi, I am filling my 2012 taxes. My most recent K1 says ‘For calendar year 2011, or tax year beginning 02/01/2011 ending 01/31/2012′. I moved from CA to NC on 04/01/2012. How should I file taxes for these states in TurboTax?

  32. I have live in NJ and have ownership in a PA S-Corporation. For which I receive a K-1. I file both a NJ and PA state return. The PA return is only for the S-corporation. In 2011’s return I was able to correctly delete the S-Corporation from the NJ return. In 2012 turbo tax refused to file the NJ return without the incorrect PA K-1 S-corporation information. How do you manually correct errors and delete forms in turbo tax? I followed the help directions. I the information was corrected, however during the final e-filing turbo tax incorrectly added the PA K-1 back into the NJ return. How can the error checking be disabled in turbo tax? How do I file an amended return? I recommend turbotax revise the way they handle S-corporations and K-1. More control should be given to the tax preparer.

  33. My husband abandoned me in April 2012 and we had an LLC from 2007 till he left. Now he’s trying to say he’s going to file a K-1 on me because I’m refuse to give him an uncontested divorce. There are no children, but he stopped paying all bills related to us. I even lost my home and had to move in with a friend. He left me indigent basically. I had worked our entire marriage until Feb 2012 when I lost my job. I was never on the LLC and I never drew a paycheck from our business. We only had owner’s draws put into our personal checking to pay household expenses and our bills. Does he have a leg to stand on or is he just being obstinate?

    • I need to correct my first statement. I lost my job in Feb 2010 and was told by Tim I could stay home and help with our business, which I did until March of 2012.

  34. We transferred our Amerigas LLP shares from Ameritrade to Fidelity, then sold them all. We’ve received two K-1 forms from Amerigas with different amounts in each. Do we enter these K-1s separately in TurboTax or somehow combine them?

  35. As the sole shareholder in my S corp Turbotax Business attached a K1 to my S corp return for around $10k profit. I did not receive this money from the corp in any way either as a disbursement or divident. Do I have to declare it on my personal earnings return even though the money is still in the corp? The only earnings I received from the corp were in the form of W2 income which I did report on my 1040.

  36. My K-1 will be done in Oct 2013. I need my personal tax returns ASAP. Can I do without K-1? If yes, would it be any negative consequences? Thanks!

    • My brother, sister, and I had an LLC–equal partnership of my Dad’s money. He died last April, and relationships have deteriorated with my siblings. In May of 2012, the money was distributed, and the LLC no longer existed. Fast forward to now, and 2 weeks before tax day. My brother dealt with all the tax and legal stuff for my Dad because he lived in the same town. I called the CPA office today that is preparing the paperwork for the partnership, and asked about my K1 form. They were very elusive (I had to call 4 times and send 1 e-mail) and one of the partners finally answered. He said he didn’t want to get involved in family drama, and that we should get an extension. Remember, I don’t get along with my siblings. I think the CPA gave the 3 K1’s to my brother, and he will give one to my sister (who he likes) but will hold onto mine for awhile. He likes to upset me, and is just plain mean. I don’t know that this is what happened, but my brother is very coniving and convincing. My question is: since I was an equal partner, I will pay an equal amount for tax prep, and the form is personal with my SSN, isn’t the CPA required to send that form to me?

  37. Helo!
    My wife is working at nail salon,she just a worker
    every years she get tax return form 1099.But this year the owner give her tax return form K1-1065.Is that a legal?.she do not sign any form or
    or contract with the owner.

  38. Can a Schedule K be downloaded onto a Turbo Tax Deluxe without having to go thru the entire Schedule K form. In other words, when I receive the Schedule K from LNG can the info from that schedule be downloaded directly into my Turbo Tax return?

  39. I am the trustee of my mother’s estate which was mostly the proceeds of the sale of her modest house that was in a trust. The assets have already been distributed to the beneficiaries. I did not realize a tax filing was due until receiving the 1099 from the bank that held the assets before distribution– the 1099 shows $20 of interest. Can I simply pay whatever taxes are due on the interest for the trust as a whole and avoid issuing K-1s to the beneficiaries? if yes, what tax form is required?

  40. What if my K! from owning my own business shows an income of $100,000.00 more then I was paid to due growth…will I be double taxed on this forever as my business never pays me as much as it reports due to growth.

  41. The firm I received a K1 from does business in 15 states. In some of these states, my income was only $100 or less. Am I required to file a state return in states where I made less than my standard deduction?

    • Hi Brandon,
      Since this income is reported to the IRS and your state you should file the state tax returns.
      Thank you,
      Lisa Greene-Lewis

      • Lisa –

        Is a K-1 Receipiant entitled to a full copy of the partnership tax return?

  42. My daughter has not and has been informed her k-l form will be a while. She need to do her income tax return in order to fill our her FASFA application for grants. Grants are on a first come basis. Do you know what is done in cases like this.

    • She can prepare a temporary return and can be helped by the Student Body Association. Then, her temp. return will be incorporated with her parents’.

  43. My wife received a K-1 in 2012 for 2011 for her grandfather’s estate that she shared with her brother. The money was taken out of the estate and devided between her and her brother. I had to file an amended return last year because the K-1 came so late. The K-1 was filed for a loss. I did our taxes this year with turbo tax and it remembered the K-1 and put the loss in capital gains loss. Is this right? I have been using Turbo Tax for 10 years now.

  44. Hi Lisa,
    We’ve a 2 partner LLC for rental investment which we invested the personal money in as loan. The LLC has a little bit of positive cash flow, so We would like to receive as a payment against the loan. What is the best way to do it so we don’t have to pay takes on this money on our personal returns? Thanks!

  45. By law is there a drop dead date one should receive their K-1 by? My taxes are ready to go and they are telling me sometime in early March which sounds excessive. Thanks

  46. I receive k1’s from 3 MLP’s that I have inside an IRA….The UBTI is below the 1k level. Do I have to even fill anything out at all on my personal tax returns or just ignore them?

    • Ed-
      My online research says you don’rt nered to do anything, but contact your IRA administrator and se if they wnat them sent to them.

  47. Last year my former employer gave me 100 shares (10%) of the company. I didnt invest anything for the shares, now she’s sending a K1 and tells me I going to have to pay for my portion of the company. No money has and I believe will not be issued to me. Am I liable for this if I didnt invest money?

  48. When I prepare the partnership tax return, the K-1’s get sent with the tax return. I also supply all my partners with a copy of their K-1. Are there any other filing requirements in regards to the K-1?

    Thanks!

  49. My girlfriend was recently asked to fill out an application that includes membership in an LLC. This includes a K1 tax (form?). The question is; Is this normal procedure nowadays? To what advantage does my gf have by doing this? Why not just file as an independant contractor with a 10-99 form? I’m certainly no tax expert, so we are confused. Any help is greatful. Thanks

  50. I am the executor of my mother’s estate. Other than personal property, two items remain in the estate for the past tax year. One is a bank account that earned around $300. The other is an IRA which earned about $550. I am having trouble getting the bank to distribute the IRA, but that is a different question. The first year I filed the final tax return and estate income tax return in a timely fashion. I have not filed for the second year and am in the fourth month overdue. Most of the money was distributed from the estate in the first year. Another good chunk was distributed two weeks into the second year. Income for the estate is mentioned above. I don’t believe I report the income from the IRA because it will be reported when the distribution is made by the bank. That makes the income of the estate under $600 and I don’t believe I have to file a 1041. Would I therefore not have to send K-1’s? It seems odd to file, then not file, then file a final form at a future date. Thank you

  51. Hi, I live in Illinois and in 2012 received approx $8000 from my Aunt’s estate (I was named a beneficiary). She lived in Wisconsin in case that matters. Will I be taxed on this money?

    Thank you,
    Lori

  52. Hi I am the trustee of my mothers trust. She passed away in March of last year. As the trustee do I have to provide the other siblings with a k-1 form and if so where do I get that form? there was a small income from the trust and inherited monies which are not taxable.
    Thank you.

  53. I am a single mother and my daughter has a pooled special needs trust. The trust company told me they are sending me a K1 form. I used the caclulation and am only getting a few dollars back for my taxes. Should I assume I could possibly owe money having to file a k1 with the interest from the trust in her name? She is only a toddler.

    Thank you

    • Hi Shannon,
      Without knowing how much interest there is and your deductions and credits I can’t say for sure. Once you do receive the K-1 TurboTax will properly calculate everything for you. If you have additional questions, don’t forget we have tax experts available to answer your questions.

      Thank you,
      Lisa Greene-Lewis

  54. Hi, If I live in Oregon, but I will receive family limited partnership distribution from a partnership in California (k-1), will I have to pay taxes in both states?

    Thank you, Tina

  55. I have been asked by an executor of an estate
    that I am an heir of, for my ss# to issue me a K-1
    form. The executor told me there are no profits
    only losses. Do I have to give them my ss# and
    do I have to use the K-1 to file my taxes. The
    estate is small I will be receiving around $5000.00 Thank You for your help

    • Hi Jeff,
      If you are the beneficiary of the estate and are receiving income from it the executor has to issue the K-1 and report who income was issued to; therefore he/she needs your ss#. You will have to report any items on the K-1 on your taxes. You can use TurboTax premier to guide you through preparing your tax return if you have a K-1. Also, don’t forget if you have any questions while your preparing your tax return you can talk to our CPAs and get your questions answered for free.
      http://turbotax.intuit.com/personal-taxes/online/premier.jsp

      Thank you,
      Lisa Greene-Lewis

  56. I just found out that I was supposed to receive k-1s for 2008, 2009 and 2010 but they weren’t sent by the s-corp. There was a large loss in 2008 due to the bank ruptcy of a customer of the corp. Now I have been told that I can’t file an ammended return because it has been more than 3 years. What can I do?

    • Hi Debby,
      Unfortunately that information is correct regarding your 2008 tax return. Generally to claim a tax refund your tax return has to be amended within 3 years from the date of your original tax return or within 2 years from the date you paid tax, whichever is later.
      You can still amend your 2009 and 2010 tax returns. Please see IRS topic 308 for more information
      http://www.irs.gov/taxtopics/tc308.html
      Thank you,
      Lisa Greene-Lewis

  57. My mother died in Nov 2011. I have just received a 2011 K-1 with fiscal year elected to begin 7/1/2011 and end 6/30/2012. I attempted to amend my Turbo Tax created 2011 return but Turbo Tax gives me an error message, telling me to file the K-1 with my 2012 tax return. The CPA who prepared the 1041 return advises that my2011 return must be amended with the K-1 and that it should not be filed with the 2012 return. His reason is that the fiscal year elected began in 2011. Who is right — the CPA or Turbo Tax?

    • Hi Paul,
      Sorry about your loss. The K-1 for the estate ended on 6/30/2012 so any income was reported through 2012; therefore, it should be reported with your 2012 tax return.
      Thank you,
      Lisa Greene-Lewis

      • Thank you Lisa. I also handled my brother’s estate who died in September 2010. My brother’s estate had less than $600 of income, so I did not file a 1041. However, after having handled my mothers estate and finding that filing a 1041 passes capital losses to beneficiaries, I would like to now file a late 1041 for my deceased brother who also had a significant capital tax loss carryover at the time of his death. There will be no tax liability on my brother’s 1041. Will the IRS accept a late filing with no penalty?

  58. Three partners left the LLC in April 2011… they sent me a K1 regarding the 4 months they were still members. I continued to liquidate the inventory as sole owner under the same EIN for the rest of 2011. The LLC was issued a 1099 by PayPal that was not included on the tax returned done without my knowledge by the non-members. Were they legally allowed to do the LLC taxes for 2011 (4 months only) without my knowledge and pertinent information. They also took all the inventory I sold as their cost of goods deduction. I am now left with a big tax bill and I feel they must have done this illegally???

  59. Hi, was wondering my previous buiness partner just now sent me a k-1 on july 20th do i have to report this because of how late he was?

  60. I received a K-1 from my deceased father’s trust. I received non-taxable income from the trust but not any taxable income. Should I have received the amount on the K-1?

  61. Hi. I hope you can clear up some confusion on my part.

    I live in Indiana, and saw the passing of an uncle early last year. He lived and died in Illinois, and the one in charge of his estate lives and works in Tennessee.

    The estate was worth approx. $1.7 million, and I was under the understanding that it was exempt from estate tax due to its size, and that as a “Hoosier”, our distribution as heirs did not exceed the state minimum on which taxes begin to acrue. So, what is the Form K about? Is this merely for the division of expenses of the estate midst the co-heirs or is their some tax liability I’m not understanding?

    Thanks for clearing things up.

    Revel

    • Hi Revel,
      Estate tax is the tax imposed by the federal government and some states based on the value of the deceased assets. For 2011 if the value of the assets was less than $5 million (5,120,000 in 2012), then you are right, the estate is exempt from estate taxes.

      However, if the estate earns income such as interest, dividends, or rents and distributes that income to you then you will be subject to taxes.

      Property received as a gift, inheritance, or bequest(through a last will and testament) is usually not included in your income, however if the property you receive later produces income such as interest, dividends, or rents then it may be taxable.

      Thank you,
      Lisa Greene-Lewis
      http://blog.turbotax.intuit.com

  62. Hi,
    I received K-1 data on form 1065 that shows I own only 18.1800000% of a rental LLC partnership. I lost money on my initial investment last year and also again this year. But when I input the data as a negative loss on the Turbo Tax K-1 form, it shows 0 and not the amount that I loss from rental. What am I doing wrong? (this is my 1st time using Turbo Tax)
    Joy

    • Hi Joy,
      Please make sure your loss isn’t greater than the basis, which is your cost of the investment. Your loss cannot be greater than your investment. If you are still having trouble, please go to our free live tax advice so they can walk you through live via chat or phone. It will be easier to go through the interview screens with them live. You can get to our tax experts through the tax program or 1.800.4.intuit.
      Thank you,
      Lisa Greene-Lewis

  63. High Lisa i know with the tax dead line has almost ended you are very busy. All the same can you please response to my question about 2007/2008 sch K1 if i can report it on my 2011 tax

    • Hi Nana,
      Not sure if you saw my answer earlier. Unfortunately, you cannot file your 2007/2008 K-1s on your 2011 tax return. You need to amend your previous tax returns. One thing to note, you can only go back and amend 3 years from the date of the original return or 2 years from the date you paid tax which ever is later so you will not be able to amend the 2007 tax return.
      Thank you,
      Lisa Greene-Lewis

  64. Hi,

    I am expecting to receive a K1 statement for money I received from a trust. My taxes are ready to go aside for that. I was already told I wouldnt receive that statement ill after the filing deadline. Is it best to just file as is and amend when I receive that form? I know I am going to owe money, just not sure the best way to take care of this.

  65. I have not received a K1 statement yet for money coming in through a trust. My taxes are filed and ready to go aside for that information. Is it best to just file and then amend the return when I get that statement? I know money will be owed, I just dont have a clue as to how much.

  66. I have 4 K-1’s, all within my retirement IRA. 3 are for commodity type ETF’s, 1 from a LLC. IN TurboTax I don’t find where I report these K-1″s are not taxable with-in my IRA. I am retired and did receive distributions which are reported in a 1099-R and are part of my taxable income?

    • Hi Bryan,
      If these K-1s are within your IRA they are probably for informational purposes. Check to see if they indicate your social security number or the ID number of the IRA account. If they indicate the ID number of the IRA account they are just for information and you do not have to file them.
      Thank you,
      Lisa Greene-Lewis

  67. I have a K-1 that has amounts in boxes 1, 2 & 3. As I understand TurboTax, it wants me to submit this as 3 different K-1s. When I do (and fill out all the information for each one), I end up with triplicate taxation in several categories (e.g., int income, div income, capital gains, etc.). What am I doing incorrectly?

    • Hi Tim,
      Box 1 – Business Income, Box 2 – Rental, Box 3 – Other Income are all related to different types of income which are all reported on different tax forms and would each be taxed. Without seeing the specific income you have they should be reported on the appropriate schedules and then the income on the schedules should appear on your 1040 form where it is all taxed depending on your final tax liability. For instance, Box 2 – Rental income should be reported on schedule E and then go to your 1040.
      If you are not comfortable with the entries, please contact our free tax experts so they can speak to you live. You can contact then through TurboTax online or at 1.800.4.intuit.
      Thank you,
      Lisa Greene-Lewis

    • Hi Nana,
      Unfortunately you cannot. You will have amend both your 2007 and 2008 tax returns and add your k-1 information for those years.
      Thank you,
      Lisa Greene-Lewis

  68. My husband works with one partner the partnership is established as an LLC. The LLC files taxes and then my husband gets a K1 with his half of the income from the LLC partnership.
    When he files his pesonal taxes, the only income he has is from the LLC partnership K1 income. On his personal tax information is he considered a sole proprietor, contractor, self employed or does he just file under his full name? And once he establishes which one of the options stated above he needs to file under what program does he need to file the personal taxes that will carry the K1 infomation and income over to the personal tax forms? He and his partner have already filed the business portion of the taxes, he now needs to file on that K1 income from the business and we don’t know which program we need to use and we need to know what his title needs to be entered as on the persona taxes? We’ve been really confused about this last year we purchased H and R Block Home Premium and it didn’t carry over the K1 income. Please help!!!

    • Hi Patricia,
      You can use either Deluxe or Premier. Please see this comparison guide.
      http://turbotax.intuit.com/personal-taxes/compare.jsp
      Regarding your husband’s personal taxes, he should file under his full personal name that he usually files his personal taxes under. He would not be considered a sole propiertor or self-employed if he invested in the partnership with one other partner. If the K-1 income is all he has, that income will flow through to the correct forms (form 1040, schedule E, etc) depending on the type of income and your entries. TurboTax will guide you through the entries. In addition, if you have any further questions you can go through TurboTax online and get answers to your questions from our tax experts for free.
      Thank you,
      Lisa Greene-Lewis

    • Hi Jay,
      Yes you do have to issue a K-1. You can use TurboTax Business to generate the K-1 for your investor.
      Thank you,
      Lisa Greene-Lewis

  69. A k-1 shows there are capital gains and other income which I never reseived, but I have to pay for the tax ?

    • Hi Kaolin,
      If you never received them and you think there is an error you need to call the company who issued the K-1 as this information is reported to the IRS.
      Thank you,
      Lisa Greene-Lewis

    • Hi Josh,
      You should call the institution(s) that should have issued them to find out if they are late sending them to you. You will need them to prepare your taxes, because the information on K-1s is also reported to the IRS and that information has to match what is reported on your tax return.
      Thank you,
      Lisa Greene-Lewis

  70. Hi,

    I have already submit my taxes with my wife(using turbo tax) and i just received k1 for 3 stocks I own(LLC)

    What should I do?

    • Hi M,
      Wait to see if your tax return is accepted. If it is, then you will have to amend your tax return and add that information. If it is rejected you can fix your tax return.
      Thank you,
      Lisa Greene-Lewis

    • Hi, I read this in heartfelt aegnrmeet. I train and represent a number of performing arts institutions on withholding matters and see first hand the lost of cultural experiences available to Americans because of the complexities of these rules. They were written with an eye on large dollars and big name tickets, but sweep widely across all lines. You should also be aware that in a recent IRS forum, an IRS Chief Counsel representative opined that accountable plan rules cannot be used to exempt travel and other expense reimbursement related to the entertainment from the 30% withholdable tax base. He did say he would look at it again and we wait with baited breath on the result.To borrow from your recommendations: Artists, Presenters, Managers and Arts Organizations may wish to join forces to lobby Congress to take this situation out of the hands of the administrative agency (IRS) by crafting a comprehensive solution to the issues presented by the current tax scheme.

  71. Lisa, still waiting for a response. Why is everyone else’s questions answered and not mine? Need to file this week.

    • Hi Greg,
      Please resend your question. I will look out for it. Or you can call 1.800.4.intuit
      Thank you,
      Lisa Greene-Lewis

    • Hi Chris,
      If your tax return was already accepted you would amend your tax return and add the K-1 info. If your return ends up not being accepted by the IRS, you do not have to amend. You can just fix your tax return and add the K-1s.
      Thank you,
      Lisa Greene-Lewis

      • Thank you..sorry one more. It was accepted…so i amend before filing deadline or i can do it anytime later in the year?

  72. Hi Sandi,
    I receive K-1 this year and my wage was report in box 10. I entered this in TurboTax but it was not add up to the total of my income ( I also have w-2 from another job). Do you know how i can report this income as my wage but i didn’t receive anything else except k-1 from my employer.
    Thank you
    Loan

    • Hi Loan,
      Box 10 of the K-1 is a net section 1231 gain, which would be reported on a different line from your W-2 income so it may be correct. Please double check your entries. If you still need assistance, please speak to one of our live tax experts via phone or chat.

      Thank you,
      Lisa Greene-Lewis

  73. Hi,
    My husband is executor for his dad’s living trust. The trust has been distributed. We had a small amount of dividend income and interest income. Can I create the return for the trust and the K-1s for his siblings using turbotax?

    • Hi Sandi,
      Yes. In order to create the tax return for the trust you need to use TurboTax Business which will create the K-1s. Once the K-1s are produced, you can use TurboTax Deluxe or Premier to report the K-1s on the individual tax returns. TurboTax will guide you through the appropriate questions and put the information on the appropriate forms.
      Thank you,
      Lisa Greene-Lewis

  74. When I try to enter a loss from my K-1 form as a negative number, TurboTax won’t accept the minus sign; a pop-up says “enter a number” and stops there. The instructions say “enter a loss as a negative number”. What’s going on here?

    • Hi Robert,
      I just entered the loss as a negative number and it worked. Please make sure your loss isn’t greater than the basis, which is your cost of the investment. If you are still having trouble, please go to our free live tax advice so they can walk you through live via chat or phone.
      Thank you,
      Lisa Greene-Lewis

  75. I received 2 K-1 from 2 s corporations that i’ve worked, should i fill out 2 Schedule E to put expenses separately or can i put all of them in an Schedule C????

    • Hi Edgardo,
      If you are using TurboTax software it will guide you through the entries and ask you to enter information for each company and then put info relative to both companies on the Schedule E.

      I would suggest using TurboTax premier for these k-1 entries.
      Thank you,
      Lisa Greene-Lewis

  76. I have received several K-1s from a company I used to work for regarding tax year 2011. I live in Indiana but the other K-1s are for other states, some have income on them and some don’t. Do I have to do non resident returns to report the income for those states also, along with Indiana?

    • Hi Roger,
      Yes, if the K-1s are for other states you would need to file non-resident returns for those states.
      TurboTax will guide you through those entries. TurboTax will ask if you earned income in any other states in the Federal program when you enter the other state information it will prompt you to prepare the tax returns for the other states.
      Thank you,
      Lisa Greene-Lewis

  77. I have a trust that was left for me when my grandmother passed away. However I think that my parents are still owners of this trust until I am 25 years of age. Do I nee to file the K1 in my name if they are the owners or is it their responsibility to file the form? I have already filed not knowing anything about the form and was unsure if I needed to amend my taxes or not.

    • Hi Tyson,
      If your parents are still the owners and you did not receive any income from the trust you should not need to file a K-1.
      Thank you,
      Lisa Greene-Lewis

  78. I need to file taxes for college aid purposes but have not receive a k-1 yet, I have received a check for the amount so I know the amount I just dont have the K-1 yet, what do i do?

    • Hi Jay,
      Unfortunately, you should wait until you receive the K-1 in case the amount reported on the K-1 differs from the amount you received. The deadline for businesses to do their taxes is 3/15 so the business entity should have the K-1 completed soon.
      Thank you,
      Lisa Greene-Lewis

  79. My wife will start getting monies in the next several weeks from a generation skipping trust. We were told that a K1 form will be sent sometime in January. There are 6 children and 4 grandchildren in my deceased father-in-laws family. Any info would be helpful, had a guy help with our taxes for the last 2 years using Turbo Tax and it is good. Thanks

  80. I have just received,(August, 2011), a K1 for $11,000 for income received Aug, 2011. This income, except for $25, was earned but not distributed, in a Trust Under Will in the years 2008 – 2011; – date of death April 2008.

    The current K1 places all income in 2011 which incorrectly affects my 2011 tax return. Should not the income be reported in the years earned in my name, but withheld, i.e., 2008, 2009, 2010 and 2011? Is it proper to ask for a K1 for each of the prior years and then file amended tax returns?

    Thanks, SB

    PS I have filed using Turbo Tax for 10 years.

    • Hi Sam,
      There are specific distribution requirements set up for each particular estate trust. The distribution requirements may have not been met in the previous years. In addition, there may be income producing activities within the trust (interest bearing accounts, bonds, rental property, capital gains) that caused the trust to earn 11,000 in 2011. A decedent’s estate is a passthrough entity meaning the beneficiary pays tax on any income earned in a specific year. A decedent’s estate is used to gather the decedent’s assets, pay debts, and distribute any remaining assets. Income is earned from property held in the estate during the period of administration or settlement. The fiduciary may have a choice whether or not to distribute all or part of the current income in a particular year.

      Generally the income is taxable whether or not all or part is distributed.
      You must report the following:
      – All income that is required to be distributed to you, whether or not it is actually distributed
      – All other amounts actually paid or credited to you, up to the amount of your share of distributable net income.

      You can also ask the fiduciary to clarify which amounts make up your share and what are the sources of income.

      I hope this helps you! TurboTax Premier will guide you in entering your K-1 information http://www.turbotax.com/lp/ty10/ppc/hp.jsp?priorityCode=4515700000&ven=gg&cid=ppc_gg_b_stan_us+ca_btt+nm+ca&adid=8672504268&skw=TurboTax&kw=turbotax

      Thank you for being a loyal customer!
      Lisa Lewis

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