What is a K-1 Tax Form?

What Is a Schedule K-1?

A Schedule K-1 is a tax form used to report an individual’s share of income, deductions, credits, and other tax-related items from a pass-through entity. These forms are issued by different types of entities—such as partnerships (Form 1065)¹ , S corporations (Form 1120-S)², and estates or trusts (Form 1041)³ – each of which has specific IRS filing requirements. Instead of paying income tax at the entity level, these organizations aim to pass tax information through to individual partners, shareholders, or beneficiaries, who may then report it on their personal tax returns.

This article provides a general overview of a Schedule K-1, including the types of entities that issue it, the types of income it may report, and where to find official IRS resources for further details. Ultimately, it is best to always consult your tax advisor if you have any questions regarding your K-1.

Who Might Receive a Schedule K-1?

The IRS requires certain entities to issue K-1s to specific parties involved:

• Partnerships: File Form 1065 and provide a K-1 to each partner.⁴
• S Corporations: File Form 1120-S and issue K-1s to shareholders.⁵
• Estates and Trusts: File Form 1041 and distribute K-1s to beneficiaries.⁶

For example, if two individuals co-own a business partnership, each might receive a K-1 reflecting their share of the business’s earnings or losses. This information is typically included in the entity’s annual filing and distributed to individuals involved for their personal tax reporting purposes.

Reading a Schedule K-1: Form 1065 Example

Each Schedule K-1 contains multiple sections. Taking Schedule K-1 from a Form 1065 as an example, here’s how it’s generally structured:⁷

• Part I: Details about the entity—name, address, Employer Identification Number (EIN).

• Part II: Details about you—name, address, ownership percentage, and share of profits or losses.

• Part III: The money details—boxes listing income, deductions, and credits.

Some common boxes include:

• Box 1: Ordinary business income (or loss)—your share of the entity’s day-to-day earnings.
• Box 2: Net rental real estate income—passive income from properties.
• Box 4: Guaranteed payments (partnerships only)—money you’re promised, regardless of profits.
• Box 8 and 9: Reporting capital gains and losses.
• Box 11: Other income—like royalties or miscellaneous earnings.

The K-1 includes references to specific IRS forms and schedules for where each item may need to be reported, such as Schedule E, Schedule D, or Schedule B. To determine where and how each item should be reported, consult with your tax advisor and relevant IRS guidance.

When Are K-1 Forms Issued?

Partnerships and S corporations must issue them by March 15, aligning with their Form 1065 or 1120S deadlines. Estates and trusts generally have until April 15, tied to Form 1041. But delays happen—entities can request extensions (up to September 15 for businesses), which may require flexibility with timing your filing.⁸

What If I Don’t Receive a K-1?

If you expect to receive a Schedule K-1 and have not received it by the applicable deadline, the IRS recommends contacting the issuing entity. If you have yet to receive it and the deadline for filing your tax return is near, you will need to speak to your tax advisor. They may advise on whether it makes sense to file an extension.

Key Terms To Help Understand K1’s

• Pass-through entity: An entity that is not subject to corporate income tax at the business level.⁹
• Tax year: The annual accounting period for reporting income and expenses.¹⁰
• Partnership: A business owned by two or more individuals.¹¹
• S Corporation: A corporation that elects to pass corporate income, losses, deductions, and credits to their shareholders.¹²
• Estates and Trusts: Entities that manage and distribute assets to beneficiaries.¹³

Official information and updates can be found at:

• IRS Schedule K-1 (Form 1065)
• IRS Schedule K-1 (Form 1120-S)
• IRS Schedule K-1 (Form 1041)

Linqto is not a tax professional, and the information provided is for general informational purposes only. It should not be construed as legal, tax, or financial advice. Please consult with a qualified tax advisor or professional for guidance specific to your situation.

Article Sources

1. https://www.irs.gov/instructions/i1065sk1 ↩︎
2. https://www.irs.gov/instructions/i1120ssk ↩︎
3. https://www.irs.gov/instructions/i1041sk1 ↩︎
4. https://www.irs.gov/forms-pubs/about-form-1065 ↩︎
5. https://www.irs.gov/forms-pubs/about-form-1120-s ↩︎
6. https://www.irs.gov/forms-pubs/about-form-1041 ↩︎
7. https://www.irs.gov/pub/irs-pdf/f1065sk1.pdf ↩︎
8. https://www.indinero.com/blog/businesses-should-know-about-k-1-forms-tax-filing/ ↩︎
9. https://taxpolicycenter.org/briefing-book/what-are-pass-through-businesses ↩︎
10. https://www.irs.gov/businesses/small-businesses-self-employed/tax-years ↩︎
11. https://www.irs.gov/businesses/partnerships ↩︎
12. https://www.irs.gov/businesses/small-businesses-self-employed/s-corporations ↩︎
13. https://www.irs.gov/e-file-providers/estates-and-trusts ↩︎