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Modified adjusted gross income is

liability” is any partnership liability for

information on Schedule K-1 (name of the

your adjusted gross income figured

which a partner is personally liable.

partnership, partnership identifying

without taking into account:

number, and tax shelter registration

Use the total of the three amounts for

•

Any passive activity loss.

number) to complete your Form 8271.

computing the adjusted basis of your

•

Any rental real estate loss allowed

partnership interest.

Item H

under section 469(c)(7) to real estate

Generally, you may use only the

If the box in Item H is checked, you are a

professionals (as defined on page 3).

•

amounts shown next to “Qualified

Any taxable social security or

partner in a publicly traded partnership

nonrecourse financing” and “Other” to

equivalent railroad retirement benefits.

and must follow the rules discussed on

•

compute your amount at risk. Do not

Any deductible contributions to an IRA

page 4 under Publicly traded

include any amounts that are not at risk if

or certain other qualified retirement plans

partnerships.

such amounts are included in either of

under section 219.

•

these categories.

Lines 1 Through 25

The student loan interest deduction.

•

If your partnership is engaged in two or

The deduction allowed under section

The amounts shown on lines 1 through 25

more different types of activities subject to

164(f) for one-half of self-employment

reflect your share of income, loss, credits,

the at-risk provisions, or a combination of

taxes.

deductions, etc., from partnership

•

at-risk activities and any other activity, the

The exclusion from income of interest

business or rental activities without

partnership should give you a statement

from Series EE or I U.S. Savings Bonds

reference to limitations on losses or

showing your share of nonrecourse

used to pay higher education expenses.

adjustments that may be required of you

•

liabilities, partnership-level qualified

The exclusion of amounts received

because of:

nonrecourse financing, and other

under an employer’s adoption assistance

1. The adjusted basis of your

liabilities for each activity.

program.

partnership interest,

Qualified nonrecourse financing

Special rules for certain other

2. The amount for which you are at

secured by real property used in an

activities. If you have net income (loss),

risk, or

activity of holding real property that is

deductions, or credits from any activity to

3. The passive activity limitations.

subject to the at-risk rules is treated as an

which special rules apply, the partnership

amount at risk. Qualified nonrecourse

For information on these provisions,

will identify the activity and all amounts

financing generally includes financing for

see Limitations on Losses,

relating to it on Schedule K-1 or on an

which no one is personally liable for

Deductions, and Credits beginning on

attachment.

repayment that is borrowed for use in an

page 2.

activity of holding real property and that is

If you have net income subject to

If you are an individual and the passive

loaned or guaranteed by a Federal, state,

recharacterization under Temporary

activity rules do not apply to the amounts

or local government or borrowed from a

Regulations section 1.469-2T(f) and

shown on your Schedule K-1, take the

“qualified” person.

Regulations section 1.469-2(f), report

amounts shown in column (b) and enter

such amounts according to the

Qualified persons include any persons

them on the lines on your tax return as

Instructions for Form 8582 (or Form

actively and regularly engaged in the

indicated in column (c). If the passive

8810).

business of lending money, such as a

activity rules do apply, report the amounts

bank or savings and loan association.

shown in column (b) as indicated in the

If you have net income (loss),

Qualified persons generally do not

line instructions.

deductions, or credits from any of the

include related parties (unless the

following activities, treat such amounts as

If you are not an individual, report the

nonrecourse financing is commercially

nonpassive and report them as instructed

amounts in column (b) as instructed on

reasonable and on substantially the same

in column (c) of Schedule K-1 or in these

your tax return.

terms as loans involving unrelated

instructions:

persons), the seller of the property, or a

The line numbers in column (c) are

1. Working interests in oil and gas

person who receives a fee for the

references to forms in use for calendar

wells if you are a general partner.

partnership’s investment in the real

year 2001. If you file your tax return on a

2. The rental of a dwelling unit any

property.

calendar year basis, but your partnership

partner used for personal purposes during

files a return for a fiscal year, enter the

See Pub. 925 for more information on

the year for more than the greater of 14

amounts shown in column (b) on your tax

qualified nonrecourse financing.

days or 10% of the number of days that

return for the year in which the

Both the partnership and you must

the residence was rented at fair rental

partnership’s fiscal year ends. For

meet the qualified nonrecourse rules on

value.

example, if the partnership’s tax year

this debt before you can include the

3. Trading personal property for the

ends in February 2002, report the

amount shown next to “Qualified

account of owners of interests in the

amounts in column (b) on your 2002 tax

nonrecourse financing” in your at-risk

activity.

return.

computation.

If you have losses, deductions, or

See Limitations on Losses,

credits from a prior year that were not

Deductions, and Credits beginning on

deductible or usable because of certain

Specific Instructions

page 2 for more information on the at-risk

limitations, such as the basis rules or the

limitations.

at-risk limitations, take them into account

Item G

in determining your net income, loss, or

General Information and

credits for this year. However, except for

If the partnership is a registration-required

Questions

passive activity losses and credits, do not

tax shelter or has invested in a

combine the prior-year amounts with any

registration-required tax shelter, it should

Item F

amounts shown on this Schedule K-1 to

have completed Item G. If you claim or

get a net figure to report on any

report any income, loss, deduction, or

Item F should show your share of the

supporting schedules, statements, or

credit from a tax shelter, you must attach

partnership’s nonrecourse liabilities,

forms attached to your return. Instead,

Form 8271 to your tax return. If the

partnership-level qualified nonrecourse

report the amounts on the attached

partnership has invested in a tax shelter,

financing, and other liabilities as of the

schedule, statement, or form on a

it must give you a copy of its Form 8271

end of the partnership’s tax year. If you

year-by-year basis.

with your Schedule K-1. Use this

terminated your interest in the partnership

information to complete your Form 8271.

during the tax year, Item F should show

If you have amounts other than those

the share that existed immediately before

If the partnership itself is a

shown on Schedule K-1 to report on

the total disposition. A partner’s “other

registration-required tax shelter, use the

Schedule E (Form 1040), enter each item

-5-

Partner’s Instructions for Schedule K-1 (Form 1065)

Partner'S Instructions For Schedule K-1 (Form 1065) - Partner'S Share Of Income, Credits, Deductions, Etc. (For Partner'S Use Only) - 2001 Page 5

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