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R. Klein, EA
R. Klein, EA, Enrolled Agent
Category: Tax
Satisfied Customers: 2880
Experience:  Over 20 Years experience
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I am curious as where to report a distibution reported on a

Resolved Question:

I am curious as where to report a distibution reported on a 1065 K-1.
I was given 10% of the partnership by my employer so therefore I have no basis. The K-1 states that the ordinary income is 110,284 and the distribution is 110,001. Those are the only 2 figures on the K-1
Submitted: 1 year ago.
Category: Tax
Expert:  R. Klein, EA replied 1 year ago.

Randalltax :

Thank you for contacting me about your Tax issue. I will work hard to help you understand the issue clearly.

Randalltax :

The ordinary income from the K-1 is reported on Page 2 of the Schedule E of your 1040.

Randalltax :

If you were active in the business, you may have a box on the K-1 Box 14A indicates self-employment earnings and flows to Schedule SE to compute the SE (medicare and Social Security tax).

Randalltax :

Distributions that are NOT in excess of basis are not taxable or reported on your 1040.

Randalltax :

Remember that any amount in Box 1, ordinary income, INCREASES your basis. Any money paid out (distributed) DECREASES your basis.

Randalltax :

Based on the numbers in your question, your basis INCREASED by $283 during the year.

Customer:

no no box 14. I'm really confused with this because I have received 0 dollars for anything other than my w-2 wages.

Randalltax :

To the contrary, says the K-1.

Randalltax :

The K-1 says you earned $110K, and almost all of it was paid to you.

Customer:

But I received NO cash

Randalltax :

Distributions do not have to be cash.

Randalltax :

But the K-1 says you received either cash or something equivalent.

Randalltax :

If you did not receive such, then you should contact the company or its accountant.

Customer:

What other distribution is there, I received NOTHING Tangible

Randalltax :

I don't know. Maybe you received $110K worth of concert tickets. Again, if you don't know what was distributed, you need to contact the person that created the K-1.

Randalltax :

I can only interpret what the document SAYS; I have no knowledge of what actually transpired.

Customer:

I certinaly will, all of this is new to me. Thanks for your help

Randalltax :

OK have a good weekend!

R. Klein, EA, Enrolled Agent
Category: Tax
Satisfied Customers: 2880
Experience: Over 20 Years experience
R. Klein, EA and other Tax Specialists are ready to help you

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