Looking for a Schedule K-1 Templates? Download it for free!

qualifying revocable trusts that made a

The domestic production activities

Specific Instructions

section 645 election), and corporations

deduction.

cannot actively participate. Limited partners

The student loan interest deduction.

Part I. Information About

cannot actively participate unless future

The tuition and fees deduction.

regulations provide an exception.

The deductible part of self-employment

the Partnership

taxes.

You are not considered to actively

The exclusion from income of interest

participate in a rental real estate activity if, at

Item D

from Series EE or I U.S. Savings Bonds used

any time during the tax year, your interest

If the box in item D is checked, you are a

to pay higher education expenses.

(including your spouse's interest) in the

partner in a publicly traded partnership and

activity was less than 10% (by value) of all

The exclusion of amounts received under

must follow the rules discussed, earlier,

interests in the activity.

an employer's adoption assistance program.

under Publicly traded partnerships.

Active participation is a less stringent

Commercial revitalization deduction.

requirement than material participation. You

The special $25,000 allowance for the

Part II. Information About

may be treated as actively participating if you

commercial revitalization deduction from

participated, for example, in making

the Partner

rental real estate activities is not subject to

management decisions or arranging for

the active participation rules or modified

others to provide services (such as repairs)

Item E

adjusted gross income limits discussed

in a significant and bona fide sense.

earlier. See the instructions for box 13, code

For your protection, this form may show only

Management decisions that can count as

Q, for more information.

the last four digits of your social security

active participation include approving new

Special rules for certain other activities.

number (SSN), individual taxpayer

tenants, deciding rental terms, approving

If you have net income (loss), deductions, or

identification number (ITIN), or employer

capital or repair expenditures, and other

credits from any activity to which special

identification number (EIN). However, the

similar decisions.

rules apply, the partnership will identify the

partnership has reported your complete

An estate is a qualifying estate if the

activity and all amounts relating to it on

identification number to the IRS.

decedent would have satisfied the active

Schedule K-1 or on an attached statement.

Item J

participation requirement for the activity for

If you have net income subject to

the tax year the decedent died. A qualifying

Generally, the amounts reported in item J are

recharacterization under Temporary

estate is treated as actively participating for

based on the partnership agreement. If your

Regulations section 1.469-2T(f) and

tax years ending less than 2 years after the

interest commenced after the beginning of

Regulations section 1.469-2(f), report such

date of the decedent's death.

the partnership's tax year, the partnership

amounts according to the Instructions for

will have entered, in the Beginning column,

Modified adjusted gross income

Form 8582 (or Form 8810).

the percentages that existed for you

limitation. The maximum special

If you have net income (loss), deductions,

immediately after admission. If your interest

allowance that single individuals and married

or credits from any of the following activities,

terminated before the end of the

individuals filing a joint return can qualify for

treat such amounts as nonpassive and report

partnership's tax year, the partnership will

is $25,000. The maximum is $12,500 for

them as indicated in these instructions.

have entered, in the Ending column, the

married individuals who file separate returns

1. Working interests in oil and gas wells

percentages that existed immediately before

and who lived apart at all times during the

if you are a general partner.

termination.

year. The maximum special allowance for

which an estate can qualify is $25,000

2. The rental of a dwelling unit any

The ending percentage share shown on

reduced by the special allowance for which

partner used for personal purposes during

the Capital line is the portion of the capital

the surviving spouse qualifies.

the year for more than the greater of 14 days

you would receive if the partnership was

or 10% of the number of days that the

liquidated at the end of its tax year by the

If your modified adjusted gross income

residence was rented at fair rental value.

distribution of undivided interests in the

(defined below) is $100,000 or less

partnership's assets and liabilities. If your

( $50,000 or less if married filing separately),

3. Trading personal property for the

capital account is negative or zero, the

your loss is deductible up to the maximum

account of owners of interests in the activity.

partnership will have entered zero on this

special allowance referred to in the

line.

preceding paragraph. If your modified

Self-charged interest. The partnership will

adjusted gross income is more than

report any “self-charged” interest income or

Item K

$100,000 (more than $50,000 if married filing

expense that resulted from loans between

Item K should show your share of the

separately), the special allowance is limited

you and the partnership (or between the

partnership's nonrecourse liabilities,

to 50% of the difference between $150,000

partnership and another partnership or S

partnership-level qualified nonrecourse

($75,000 if married filing separately) and

corporation if both entities have the same

financing, and other recourse liabilities as of

your modified adjusted gross income. When

owners with the same proportional

the end of the partnership's tax year. If you

modified adjusted gross income is $150,000

ownership interest in each entity). If there

terminated your interest in the partnership

or more ($75,000 or more if married filing

was more than one activity, the partnership

during the tax year, item K should show the

separately), there is no special allowance.

will provide a statement allocating the

share that existed immediately before the

interest income or expense with respect to

Modified adjusted gross income is your

total disposition. A partner's “recourse

each activity. The self-charged interest rules

adjusted gross income figured without taking

liability” is any partnership liability for which a

do not apply to your partnership interest if the

into account the following amounts, if

partner is personally liable.

partnership made an election under

applicable:

Regulations section 1.469-7(g) to avoid the

Use the total of the three amounts for

Any passive activity loss.

application of these rules. See the

computing the adjusted basis of your

Any rental real estate loss allowed under

Instructions for Form 8582 for details.

partnership interest.

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

(defined earlier).

Generally, you may use only the amounts

Any overall loss from a publicly traded

shown next to “Qualified nonrecourse

partnership.

financing” and “Recourse” to figure your

Any taxable social security or equivalent

amount at risk. Do not include any amounts

railroad retirement benefits.

that are not at risk if such amounts are

included in either of these categories.

Any deductible contributions to an IRA or

certain other qualified retirement plans under

If your partnership is engaged in two or

section 219.

more different types of activities subject to

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

-5-

Partner'S Instructions For Schedule K-1 (Form 1065) - Partner'S Share Of Income, Deductions, Credits, Etc. (For Partner'S Use Only) - 2014 Page 5

Related Articles

Related forms

Related Categories