This article focuses solely on the entry of Self-Employment Earnings (Loss) which is found on Box 14 of the Schedule K-1 (Form 1065) Partner's Share of Income, Deductions, Credits, etc. For additional information regarding the requirements for Schedule K-1 (Form 1065) see: Partner's Instructions for Schedule K-1 (Form 1065).
To enter Self-Employment Earnings (loss) from tax form Schedule K-1 (Form 1065) in TaxSlayer Pro from the Main Menu of the Tax Return (Form 1040) select:
- Income
- Rents, Royalties, Entities (Sch E, K-1, 4835, 8582)
- K-1 Input - Select New and double-click Form 1065 K-1 Partnership which will take you to the K-1 Heading Information Entry Menu.
The K-1 1065 Edit Screen has two distinct sections entitled Heading Information and Income, Deductions, Credits, and Other Items. After entering all of the information required on the K-1 Heading Information screen, select OK.
The K-1 1065 Edit Screen in TaxSlayer Pro has an entry for each box on found on the Schedule K-1 (Form 1065) that the taxpayer received. A description of the items contained in box 14 are below.
SELF-EMPLOYMENT EARNINGS (LOSS)
Line 14A - Net Earnings (Loss) from Self-Employment - Amounts reported in Box 14, Code A represent the amount of net earnings from self-employment. For Limited Partners this amount generally includes any guaranteed payments received for services rendered to or on behalf of the partnership. Enter the amount from Box 14, Code A will be entered as Net Earnings/Loss from Self-Employment. If any amount has been entered on Line 12 of the K-1 as a Section 179 Deduction, it will automatically pull to this menu.
For General Partners, the amount in Box 14, Code A may be reduced by certain expenses that were not reimbursed by the partnership by entering the expenses as Unreimbursed Employee Expenses. If the amount in Box 14, code A is reduced for any reason, an explanation should be attached to the return. This explanation can be generated by creating a Preparer Note. To create a Preparer Note, from the Main Menu of the tax return (Form 1040), select Miscellaneous Forms, then Notes/Statements, then Preparer Notes. See: Instructions for Schedule SE (Form 1040) Self-Employment Tax.
Line 14B - Gross Farming or Fishing Income - Amounts reported in Box 14, Code B that are entered will automatically carry as an item of information to Schedule E (Form 1040), line 42. However, this amount may also be used to determine net earnings from self-employment under the farm optional method on Schedule SE (Form 1040), Section B, Part II. If the taxpayer elects the farm optional method on Schedule SE, it will need to be entered on that menu and it will not automatically carry from this menu. See: Instructions for Schedule SE (Form 1040) Self-Employment Tax.
Line 14C - Gross Non-Farm Information - Amounts reported in Box 14, Code C are used to determine net earnings from self-employment under the nonfarm optional method on Schedule SE (Form 1040), Section B, Part II. If the taxpayer elects the nonfarm optional method on Schedule SE, it will need to be entered on that menu and it will not automatically carry from this menu. See: Instructions for Schedule SE (Form 1040) Self-Employment Tax.
Note: This is a guide on entering the Self-Employment items from Schedule K-1 (Form 1065) into the TaxSlayer Pro program. This is not intended as tax advice.
Additional Information:
Partner's Instructions for Schedule K-1 (Form 1065)
Schedule K-1 (Form 1065) - Overview
Schedule K-1 (Form 1065) - Heading Information
Schedule K-1 (Form 1065) - Income (Loss) Items
Schedule K-1 (Form 1065) - Deductions
Schedule K-1 (Form 1065) - Credits & Foreign Transaction Items
Schedule K-1 (Form 1065) - Alternative Minimum Tax (AMT) Items
Schedule K-1 (Form 1065) - Tax Exempt Income, Non-Deductible Expenses, Distributions & Other Items