Form 541 - Partnerships - Department Of Treasury Internal Revenue Service - 2002 Page 20
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28Schedule K–1 (Form 1065)
Self-Employment
Line 5. This line on Schedule K – 1 shows
only the guaranteed payments to Frank of
Line 15a. Net earnings (loss) from self-em-
$20,000. This line on Schedule K shows the total
Schedule K – 1 lists each partner’s share of in-
ployment are figured using the worksheet in the
guaranteed payments to both partners of
come, deductions, credits, etc. It also shows
Form 1065 instructions for Schedule K (not
$25,000.
where to report the items on the partner’s indi-
shown). Frank and Susan’s net earnings from
vidual income tax return. Illustrated is a copy of
self-employment are the total of the partnership
the Schedule K – 1 for Frank W. Able. All infor-
Deductions
income shown on line 1 of Schedule K and the
mation asked for at the top of Schedule K – 1
guaranteed payments shown on line 5. This
must be supplied for each partner.
Line 8. During the year, the partnership
total, $74,370, is entered on Schedule K, and
made a $650 cash contribution to the American
each individual partner’s share is shown on his
Allocation of
Lung Association. Each partner may be able to
or her Schedule K – 1. Each partner uses his or
Partnership Items
deduct his or her share of the partnership’s char-
her share to figure his or her self-employment
itable contribution on his or her individual in-
tax on Schedule SE (Form 1040), Self-Employ-
The partners’ shares of income, deductions,
come tax return if the partner itemizes
ment Tax (not shown).
etc., are shown next.
deductions. Frank’s share of the contribution,
$325, is entered on this line of Schedule K – 1.
Other
This line on Schedule K shows the total contribu-
Income (Loss)
tion.
Line 19. Frank enters the $50 municipal
Line 1. This line on Schedule K – 1 shows
bond interest received by the partnership on this
Frank’s share ($24,685) of the income from the
Investment Interest
line of Schedule K and $25 on this line of each
partnership shown on Form 1065, page 1, line
partner’s Schedule K – 1.
22. The total amount of income to both partners
Line 14b. The partnership had no interest
Line 22. Frank enters the $52,880 cash
is shown on line 1, Schedule K.
expense on investment debts, but it had invest-
withdrawals made by the partners during the
ment income (dividends) of $150 as shown on
Line 4b. Dividends must be separately
year on this line of Schedule K. He enters the
line 4b, Schedule K. That amount is also shown
stated. They are not included in the income
amount each partner withdrew on this line of the
on this line of Schedule K, and the partner’s
(loss) of the partnership on Form 1065, page 1,
partner’s Schedule K – 1.
share is shown on this line of Schedule K – 1.
line 22. This line on Schedule K – 1 shows
Frank’s share, $75. This line on Schedule K
shows the total dividends of $150.
Page 20
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