Below are solutions to frequently asked questions about entering information on the Passthrough K-1's screen in Lacerte.
How do I enter distributions reported on a passthrough K-1 issued to another partnership or S corporation?
There aren't direct inputs specifically for distributions on the Passthrough K-1's screen in the S-Corporate or Partnership modules. You'll need to enter distributions from another passthrough entity in the input screen where you'd report distributions from the entity itself.
Follow these steps to enter distributions for the Schedule M-2:
- Go to Screen 28, Schedule M-2 (Capital Account).
- Locate the Analysis of Partners' Capital Accounts (M-2) section.
- Scroll down to the Distributions subsection.
- Enter the amount in the applicable field:
- Cash and marketable securities
Follow these steps to enter distributions for the Schedule K / K-1:
- Go to Screen 22, Other Schedule K Items.
- Scroll down to the Distributions section.
- Enter the amount in Cash and marketable securities [A].
Follow these steps to enter distributions:
- Go to Screen 8, Distributions, Loan Repayments.
- Choose the appropriate Shareholder from the top left navigation panel.
- Enter the Distributions (including cash) other than dividends.
How do I source income for a multi-state passthrough K-1 in the program?
When entering a multi-state K-1 in the Passthrough K-1's screen of the Individual or Fiduciary module, you always want to start with the Federal Amount column. This will make the amounts flow to the federal return and the resident state return.
Sourcing the Federal Amount column:
Press Ctrl+E on your keyboard to open the source box on the Federal Amount column. From here you can choose code N or code S in the Source column to show Lacerte how to source the amounts.
- Use code N if you want Lacerte to report this amount on the federal return.
- This will still flow to state returns that start the return on federal amounts.
- Use code S if you want Lacerte to report this amount directly on the state return and bypass the federal return.
- To remove the code N or code S, click in the Source field and choose the blank option at the top of the dropdown list.
Using the State, if different column:
You should only use this column when there are differences between federal and state tax law. For example, ordinary income is different between federal and state due to different section 179 limitations.
Using this field will create an adjustment on the state return. This column is most commonly used for the resident state when working with a multi-state return.
State Source Amount column:
This column is used for entering state-specific amounts for nonresident states.
How do I import or export K-1 information between business returns?
Refer to this article for instructions on importing or exporting K-1 information between business returns in Lacerte.