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Box 3. Other Net Rental Income

However, if the box in item D is checked,

If you have any foreign source

report the loss following the rules for Publicly

qualified dividends, see the

(Loss)

traded partnerships, earlier.

instructions for box 16, later.

CAUTION

The amount in box 3 is a passive activity

Box 2. Net Rental Real Estate

amount for all partners. If the partnership had

Note. In the case of a corporate partner, the

Income (Loss)

more than one rental activity, it will attach a

partnership will attach a statement to the

statement identifying the income or loss from

Schedule K-1 explaining what part of the

Generally, the income (loss) reported in

each activity. Report the income or loss as

dividends included in boxes 6a and 6b is

box 2 is a passive activity amount for all

follows.

eligible for the “dividends received by

partners. However, the income (loss) in

corporations deduction” under section

1. If box 3 is a loss, follow the

box 2 is not from a passive activity if you

243(a), (b), or (c).

Instructions for Form 8582 to figure how

were a real estate professional (defined

much of the loss can be reported on

Box 7. Royalties

earlier) and you materially participated in the

Schedule E (Form 1040), line 28, column (f).

activity. If the partnership had more than one

Report royalties on Schedule E (Form 1040),

However, if the box in item D is checked,

rental real estate activity, it will attach a

line 4.

report the loss following the rules for Publicly

statement identifying the income or loss from

traded partnerships, earlier.

Box 8. Net Short-Term Capital

each activity.

2. If income is reported in box 3, report

Gain (Loss)

If you are filing a 2014 Form 1040, use

the income on Schedule E (Form 1040),

the following instructions to determine where

Report the net short-term capital gain (loss)

line 28, column (g). However, if the box in

to report a box 2 amount.

on Schedule D (Form 1040), line 5.

item D is checked, report the income

1. If you have a loss from a passive

following the rules for Publicly traded

Box 9a. Net Long-Term Capital

activity in box 2 and you meet all the

partnerships, earlier.

Gain (Loss)

following conditions, report the loss on

Box 4. Guaranteed Payments

Schedule E (Form 1040), line 28, column (f).

Report the net long-term capital gain (loss)

on Schedule D (Form 1040), line 12.

Generally, amounts on this line are not

a. You actively participated in the

passive income, and you should report them

partnership rental real estate activities. See

If you have any foreign source net

on Schedule E (Form 1040), line 28, column

Special allowance for a rental real estate

long-term capital gain (loss), see

(j) (for example, guaranteed payments for

activity, earlier.

the instructions for box 16, later.

personal services).

CAUTION

b. Rental real estate activities with

Box 9b. Collectibles (28%) Gain

active participation were your only passive

Portfolio Income

activities.

(Loss)

Portfolio income or loss (shown in boxes 5

c. You have no prior year unallowed

Report collectibles gain or loss on line 4 of

through 9b and in box 11, code A) is not

losses from these activities.

the 28% Rate Gain Worksheet—Line 18 in

subject to the passive activity limitations.

d. Your total loss from the rental real

the Instructions for Schedule D (Form 1040).

Portfolio income includes income (not

estate activities was not more than $25,000

derived in the ordinary course of a trade or

If you have any foreign source

(not more than $12,500 if married filing

business) from interest, ordinary dividends,

collectibles (28%) gain (loss), see

separately and you lived apart from your

annuities or royalties, and gain or loss on the

the instructions for box 16, later.

spouse all year).

sale of property that produces such income

CAUTION

e. If you are a married person filing

or is held for investment.

Box 9c. Unrecaptured Section

separately, you lived apart from your spouse

Box 5. Interest Income

1250 Gain

all year.

Report interest income on line 8a of Form

You have no current or prior year

There are three types of unrecaptured

1040. If the amount of interest income

unallowed credits from a passive activity.

section 1250 gain. Report your share of this

included in box 5 includes interest from the

unrecaptured gain on the Unrecaptured

g. Your modified adjusted gross income

credit for holders of clean renewable energy

Section 1250 Gain Worksheet—Line 19 in

was not more than $100,000 (not more than

bonds, the partnership will attach a

the Instructions for Schedule D (Form 1040)

$50,000 if married filing separately and you

statement to Schedule K-1 showing your

as follows.

lived apart from your spouse all year).

share of interest income from these credits.

Report unrecaptured section 1250 gain

h. Your interest in the rental real estate

Because the basis of your interest in the

from the sale or exchange of the

activity was not held as a limited partner.

partnership has been increased by your

partnership's business assets on line 5.

share of the interest income from these

2. If you have a loss from a passive

Report unrecaptured section 1250 gain

credits, you must reduce your basis by the

activity in box 2 and you do not meet all the

from the sale or exchange of an interest in a

same amount. See line 4 of the Worksheet

conditions in 1, above, follow the Instructions

partnership on line 10.

for Adjusting the Basis of a Partner's Interest

for Form 8582 to figure how much of the loss

Report unrecaptured section 1250 gain

in the Partnership, earlier.

you can report on Schedule E (Form 1040),

from an estate, trust, regulated investment

line 28, column (f). However, if the box in

company (RIC), or real estate investment

Box 6a. Ordinary Dividends

item D is checked, report the loss following

trust (REIT) on line 11.

Report ordinary dividends on line 9a of Form

the rules for Publicly traded partnerships,

If the partnership reports only

1040.

earlier.

unrecaptured section 1250 gain from the

3. If you were a real estate professional

Box 6b. Qualified Dividends

sale or exchange of its business assets, it

and you materially participated in the activity,

will enter a dollar amount in box 9c. If it

Report any qualified dividends on line 9b of

report box 2 income (loss) on Schedule E

reports the other two types of unrecaptured

Form 1040.

(Form 1040), line 28, column (h) or (j).

gain, it will provide an attached statement

Note. Qualified dividends are excluded

4. If you have income from a passive

that shows the amount for each type of

from investment income, but you may elect

activity in box 2, report the income on

unrecaptured section 1250 gain.

to include part or all of these amounts in

Schedule E (Form 1040), line 28, column (g).

investment income. See the instructions for

If you have any foreign source

However, if the box in item D is checked,

line 4g of Form 4952, Investment Interest

unrecaptured section 1250 gain,

report the income following the rules for

Expense Deduction, for important

see the instructions for box 16,

Publicly traded partnerships, earlier.

CAUTION

information on making this election.

later.

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

-7-

Partner'S Instructions For Schedule K-1 (Form 1065) - Partner'S Share Of Income, Deductions, Credits, Etc. (For Partner'S Use Only) - 2014 Page 7

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