What is a Schedule K-1?

K-1 is issued by partnerships, S-corps, estates, and trusts to report each owner/beneficiary share of income, deductions, and credits. Each partner/shareholder reports K-1 items on their personal return.

How is partnership income allocated?

According to the partnership agreement. The agreement specifies each partner distributive share, which must have substantial economic effect. Absent agreement, allocated per ownership percentage.

Does K-1 income affect basis?

Yes. K-1 income increases outside basis; K-1 losses and distributions decrease it. You cannot deduct losses exceeding your basis. Track basis carefully to avoid unexpected tax.

Is K-1 income subject to self-employment tax?

Partnership K-1 ordinary income for general partners is subject to SE tax. Limited partners and S-corp shareholders generally are not subject to SE tax on their allocated share.

Partnership K-1s are due with the partnership return: March 15 (or September 15 with extension). S-corp K-1s are similarly due March 15.

US K-1 Pass-Through Income Allocation Calculator

Calculate K-1 pass-through income from partnerships, S-corporations, and trusts. Allocate ordinary income, capital gains, 179 deductions, credits, and basis adjustments to partner/shareholder returns.

Principal ($)

Annual Rate (%)

Years

Compounding / Year

$ Finance Disclaimer: These calculators are for educational and illustrative purposes only. Results do not constitute financial advice. Consult a licensed financial advisor before making investment or borrowing decisions.

How It Works

Calculate K-1 pass-through income from partnerships, S-corporations, and trusts. Allocate ordinary income, capital gains, 179 deductions, credits, and basis adjustments to partner/shareholder returns

Each component has a specific meaning:

Partnerships — The partnerships recorded for the scenario being assessed.
S-corporations — The s-corporations recorded for the scenario being assessed.
Trusts — The trusts recorded for the scenario being assessed.

Note: Interpret the k-1 pass-through income result against the thresholds and context described above.

How to Use

Enter the partnerships, S-corporations, trusts for the scenario you are assessing. Calculate K-1 pass-through income from partnerships, S-corporations, and trusts. Allocate ordinary income, capital gains, 179 deductions, credits, and basis adjustments to partner/shareholder returns. Use the k-1 pass-through income result to inform your calculation.

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Frequently Asked Questions

What is a Schedule K-1?

How is partnership income allocated?

Does K-1 income affect basis?

Is K-1 income subject to self-employment tax?

When are K-1s due?