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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 13335
Experience:  15years with H & R Block. Divisional leader, Instructor
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I have a IRA and received 2 schedule K-1 tax forms for 2012.

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I have a IRA and received 2 schedule K-1 tax forms for 2012. I did not include this in my 2012 return. I was told I only had to pay taxes on this when I withdrew my required anual amount. I have just read that this is not the case. What do I do to clear this up

Robin D. :

Hello and thanks for trusting me to help you today. I am a tax adviser with over 15 years of experience.
The K1 would have been sent actually to the IRA not you personally.


Check to make sure that the recipient of the K-1 is not you personally, but rather your IRA. The IRA should have its own tax ID number, and should be listed as something like "Custodial IRA for (Your Name)".
Normally if the IRA has Check for unrelated business taxable income, or UBTI. Generally, the only time you have to report the income from your K-1 in an IRA is when your investment generates an excess of UBTI. Unrelated business taxable income is generated when an IRA invests with direct ownership in an income-producing investment, particularly in investments that are leveraged.


Robin D. :

Fill out Form 990-T, "Exempt Organization Business Tax Return," if you have UBTI over $1,000. Some, but not all, IRA custodians will complete your Form 990-T for you.


Robin D. :

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