Partner'S Instructions For Schedule K-1 (Form 1065-B) - Partner'S Share Of Income (Loss) From An Electing Large Partnership (For Partner'S Use Only) - 2016 Page 6
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13passive income on the form or schedule
security number (SSN), individual
(unless the nonrecourse financing is
you normally use.
taxpayer identification number (ITIN), or
commercially reasonable and on
employer identification number (EIN).
substantially the same terms as loans
Example. You have a Schedule E loss
However, the partnership has reported
involving unrelated persons), the seller of
of $12,000 (current year losses plus prior
your complete identification number to the
the property, or a person who receives a
year unallowed losses) and a Schedule D
IRS.
fee for the partnership's investment in the
gain of $7,200. Report the $7,200 gain on
real property.
the appropriate line of Schedule D. On
Publicly Traded
Schedule E (Form 1040), line 28, report
See Pub. 925 for more information on
Partnership (PTP)
$7,200 of the losses as a passive loss in
qualified nonrecourse financing.
column (f). Carry forward to 2017 the
If the “publicly traded partnership” box is
Both the partnership and you must
unallowed loss of $4,800 ($12,000 −
checked, you are a partner in a publicly
meet the qualified nonrecourse rules on
$7,200).
traded partnership (PTP) and must follow
this debt before you can include the
If you have unallowed losses from
the rules under Publicly traded
amount shown next to “Qualified
more than one activity of the PTP or from
partnerships discussed above.
nonrecourse financing” in your at-risk
the same activity of the PTP that must be
computation.
Partner's Share of
reported on different forms, you must
See
Limitations on Losses,
allocate the unallowed losses on a pro
Liabilities
Deductions, and
Credits, earlier, for more
rata basis to figure the amount allowed
The partnership will show your share of
information on the at-risk limitations.
from each activity or on each form.
the partnership's nonrecourse liabilities,
Boxes 1 Through 9
To allocate and keep a record of
partnership-level qualified nonrecourse
the unallowed losses, use
financing, and other liabilities as of the end
TIP
The amounts shown in boxes 1 through 9
Worksheets 5, 6, and 7 of Form
of the partnership's tax year. If you
reflect your share of income, loss,
8582. List each activity of the PTP in
terminated your interest in the partnership
deductions, credits, etc., from the
Worksheet 5. Enter the overall loss from
during the tax year, the amounts should
partnership. These amounts don’t take
each activity in column (a). Complete
reflect the share that existed immediately
into consideration the following limitations.
column (b) of Worksheet 5 according to its
before the total disposition. A partner's
The adjusted basis of your partnership
instructions. Multiply the total unallowed
“other liability” is any partnership liability
interest.
loss from the PTP by each ratio in column
for which a partner is personally liable.
The amount for which you are at risk.
(b) and enter the result in column (c) of
The passive activity limitations.
Use the total of the three amounts for
Worksheet 5. Then, complete Worksheet
figuring the adjusted basis of your
6 if all the loss from the same activity is to
For information on these provisions,
partnership interest.
be reported on one form or schedule. Use
see
Limitations on Losses, Deductions,
Worksheet 7 instead of Worksheet 6 if you
and
Credits, earlier.
Generally, you can use only the
have more than one loss to be reported on
amounts shown next to “Qualified
For individuals, the following
different forms or schedules for the same
nonrecourse financing” and “Other” to
instructions explain how to report the
activity. Enter the net loss plus any prior
figure your amount at risk. Don’t include
amounts shown in the boxes. For all other
year unallowed losses in column (a) of
any amounts that aren’t at risk if such
entities, report the amounts in the boxes
Worksheet 6 (or Worksheet 7, if
amounts are included in either of these
as instructed on your income tax return.
applicable). The losses in column (c) of
categories.
Worksheet 6 (column (e) of Worksheet 7)
The line numbers in these instructions
If your partnership is engaged in two or
are references to forms in use for calendar
are the allowed losses to report on the
more different types of activities subject to
forms or schedules. Report both these
year 2016. If you file your tax return on a
the at-risk provisions, or a combination of
losses and any income from the PTP on
calendar year basis, but your partnership
at-risk activities and any other activity, the
the forms and schedules you normally
files a return for a fiscal year, enter the
partnership should give you a statement
use.
amounts shown in the boxes on your tax
showing your share of nonrecourse
return for the year in which the
4. If you have an overall loss and you
liabilities, partnership-level qualified
partnership's fiscal year ends. For
disposed of your entire interest in the PTP
nonrecourse financing, and other liabilities
example, if the partnership's tax year ends
to an unrelated person in a fully taxable
for each activity.
on June 30, 2017, report the amounts in
transaction during the year, your losses
the boxes on your 2017 income tax return.
Qualified nonrecourse financing.
(including prior year unallowed losses)
Qualified nonrecourse financing generally
If you have losses, deductions, or
allocable to the activity for the year are not
includes financing for which no one is
credits from a prior year that were not
limited by the passive loss rules. A fully
personally liable for repayment that is
deductible or usable because of certain
taxable transaction is one in which you
borrowed for use in an activity of holding
limitations, such as the basis rules or the
recognize all your realized gain (loss).
real property and that is loaned or
at-risk limitations, take them into account
Report the income and losses on the
guaranteed by a federal, state, or local
in determining your net income, loss, or
forms and schedules you normally use.
government or borrowed from a “qualified”
credits for this year. However, except for
For rules on the disposition of an
person. Qualified nonrecourse financing
passive activity losses and credits, don’t
entire interest reported using the
secured by real property used in an
combine the prior year amounts with any
TIP
installment method, see the
activity of holding real property that is
amounts shown on this Schedule K-1 to
Instructions for Form 8582.
subject to the at-risk rules is treated as an
get a net figure to report on any supporting
amount at risk.
schedules, statements, or forms attached
to your return. Instead, report the amounts
Specific Instructions
Qualified persons. Qualified persons
separately on the attached schedule,
include any persons actively and regularly
statement, or form on a year-by-year
engaged in the business of lending
Partner's identifying number. For your
basis.
money, such as a bank or savings and
protection, this Schedule K-1 may show
loan association. Qualified persons
For amounts other than those shown
only the last four digits of your social
generally don’t include related parties
on Schedule K-1, enter each item on a
Instructions for Schedule K-1 (1065-B)
-6-
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