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federal income tax purposes does not

Note.

Part IV

The PA S corporation

file on a calendar-year basis, fill in

includes distributions to

Distributions from

fiscal-year oval. Enter the month,

Pennsylvania resident shareholders

Partnerships

day and year (MMDDYY) when the

from its PA C corporation earnings

fiscal year begins and ends.

and profits as taxable dividend

Non corporate shareholders and

income on the PA-20S/PA-65 RK-1,

partners should use amounts from

Short Year

Part II, Line 3.

PA-20S/PA-65 Schedule RK-1, Part

A short year is an accounting period

IV through Part VII (other than Line

shorter than one year and not a

12 and Line 17) to determine or

Part III

52/53 week taxable year.

calculate owner’s basis. Partners

A short-year return is required for

include Line 12 in net classified

Owner’s Share of

the following reasons:

income on their Pennsylvania tax

Pennsylvania Credits

●

Changes in the annual accounting

returns.

Enter the owner’s pro rata

period. For example, the entity

distributive share of the separately

Line 10

changes from a fiscal-year filer to a

stated credits that the PA S

calendar-year filer; or

Distribution of Cash,

corporation or partnership passes

●

An entity is in existence during

Marketable Securities and

through to the owners from the PA-

only part of the tax year. For

Property Not Including

20S/PA-65 Information Return.

example, if the year is the initial year

Guaranteed Payments

or the entity sells or exchanges 50

Line 8

percent or more of ownership

Enter the partner’s share of

interest.

Resident Credit - Submit

distribution of cash, marketable

See the PA-20S/PA-65

securities and property, other than

Statement

instructions on how to file a short-

guaranteed payments.

Enter the Pennsylvania resident

year return.

With respect to liquidating

owner’s pro rata distributive share of

property distributions, this line will

credit calculated from composite

include the total of cash and the fair

Line Instructions

returns filed by the PA S corporation

market value of marketable

or partnership on behalf of resident

securities and property distributed to

owners. Submit a statement with the

Part II

the Pennsylvania resident partner.

PA-20S/PA-65 RK-1 to notify the

The partner reduces his basis in

owner of the breakdown of states,

Owner’s Distributive

the partnership by amount of

breakdown by Pennsylvania income

Share of Pennsylvania-

distributions. If the distribution

class, taxes paid to those states and

Source Income (Loss)

amount is in excess of basis it must

the resident credit claimed, which is

be reported on the resident partner’s

the lessor of the actual tax paid or

return as taxable gain on PA-20S/PA-

Line 1

3.07 percent of the total income

65 Schedule D.

taxed in the other state.

Pennsylvania-Taxable

The statement must include the

Business Income (Loss)

Line 11

entity’s name, entity’s federal

from Operations

employer identification number, tax

Guaranteed Payments for

Enter the owner’s pro-rata

year, owner name(s) and owner tax

Capital or Other Services

distributive share from the PA-

identification number(s).

Enter the partner’s share of

20S/PA-65 Information Return, Line

guaranteed payments for capital or

Line 9

1e. The entity must report the

other services.

owner’s share of income (loss)

Total Other Credits - Submit

Pennsylvania personal income tax

whether distributed or not. If

Statement

rules classify distributions of

reporting a loss fill in the oval.

Enter the owner’s pro rata share

guaranteed payments for capital or

from the PA-20S/PA-65 Information

other services as follows:

Guaranteed payments should

Return, Line 13a. The entity must

●

A withdrawal proportionately from

not be included on Line 1 of

provide the owner with a statement

the capital of all partners;

the PA-20S/PA-65

listing which credit(s) have been

●

A gain from the disposition of the

Schedule RK-1.

passed through to them. When

recipient’s partnership interest and a

applicable, Line 9 includes credits for

loss from the disposition of the other

Lines 2 through 7

PA S corporations treated as C

partners’ partnership interests, to the

Enter the owner’s pro rata

corporations in other states.

extent derived from the capital of the

distributive share of the separately

The statement must include the

other partners; and

stated items of other Pennsylvania-

entity’s name, entity’s federal

●

A return of capital by the

taxable income (loss) from the PA-

employer identification number, tax

recipients to the extent derived from

20S/PA-65 Information Return.

year, owner name(s), and owner tax

their own capital. The distributions

Pennsylvania-taxable income

identification number(s).

that the partnership makes that

includes total of Pennsylvania-source

represent repayments of the

Important.

and outside Pennsylvania income

See PA-20S/PA-

partner’s own capital are not

(loss). If reporting a loss on Lines 4,

65 Schedule OC instructions

considered income for Pennsylvania

5 and/or 7, fill in the oval.

for which credits must be applied to

personal income tax purposes.

corporate tax liability prior to being

passed through to the entity’s

owners.

- 4 -

Instructions for PA-20S/PA-65 Schedule RK-1

Instructions For Form Pa-20s/pa-65 - Schedule Rk-1 - Resident Schedule Of Shareholder/partner/beneficiary Pass Through Income, Loss And Credits - 2012 Page 4

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