Schedule K-1 (Form 1120-S) is a source document that is filed with the S corporation income tax return (Form 1120-S). After filing Form 1120-S, the corporation gives each shareholder their Schedule K-1. The K-1 reflects a shareholder's share of income, deductions, credits, and other items that the shareholder will need to report on their individual tax return.
In TaxSlayer Pro, the S corp Schedule K-1 is entered in a menu specifically designed for it. Most amounts will pull to the appropriate form or schedule in the tax return, while other amounts require the preparer to determine if and where they need to be reported.
The S corp K-1 consists of three parts:
- Part I - Information about the Corporation. This section contains basic information about the corporation such as its name, address and EIN.
- Part II - Information about the Shareholder. This section contains information about the shareholder's percentage of stock ownership in the corporation.
- Part III - Shareholder's Share of Current Year Income, Deductions, Credits, and Other Items. This section reports the shareholder's share of the corporation's income, deductions, credits, and other amounts.
To assist you in entering the K-1 in the tax return, read the IRS instructions linked below as well as any additional information the corporation provided the taxpayer/shareholder with the K-1.
To enter Schedule K-1 (Form 1120-S) in the individual return TaxSlayer Pro, from the Main Menu of the tax return (Form 1040) select:
- Rents, Royalties, Entities (Sch E, K-1, 4835, 8582)
- K-1 Input - The next step depends on whether or not you also prepared the S corp return in TaxSlayer Pro:
- If you didn't prepare the S corp return in TaxSlayer Pro, select New, then double-click Form 1120-S K-1.
- If you prepared the S corp return in TaxSlayer Pro, click the Pull button, then select Business Package. The program will pull in any K-1s for this taxpayer (and in a joint return, for the spouse).
Note: This is a guide on entering Schedule K-1 (Form 1120-S) into the TaxSlayer Pro program. This is not intended as tax advice.