Schedule E, Part II: Partnership & S-Corporations

This information is not tax advise. This page includes information on entering income to be reported on Schedule E, Part II Partnership and S-Corporations. Any specific tax information is given as a reference to using the program.
See IRS Schedule E Instructions for more information.

There is no limit to the amount of listings a tax return being eFiled can have (in reference to Partnership and/or S-Corporation Income).



IMPORTANT:
Be certain that you understand "active participation" and gains and losses pertaining to "passive activities".
If you are NOT at risk with any of these items, or you will be treating the items differently than stated on Schedule K-1(s)
and you are required file Form 8082, you can not use this system.




Adding Partnership and S-Corporation Listing Page:


Both the "Partnership and S-Corporation Listing Page" and the "Schedule E" are listed in the Income Forms. Choose the applicable option to meet your needs.





 Entering the Information:




Do these items belong to a Partnership or S-Corporation:

Select the Entity Type (Partnership or S-Corporation) and enter the Federal Identification Number
(FIN) from the Schedule K-1 (Form 1065).

 

Name of Partnership or S-Corporation:

Enter the name of the Partnership or S-Corporation.

Do not combine income from more than one Partnership or S-Corporation. Create a separate listing for each individually. 





It is the users responsibility to complete Form 6521 to include income from Partnerships and S-Corporations (when applicable).                           
Per the IRS Schedule E Instructions:
You must take into account your share of preferences and adjustments from these entities for the                                Alternative Minimum Tax on Form 6251.


Check the Boxes That Apply:

  • All Investment at Risk:
  • Foreign Partnership:
  • AMT Items to Report: Check this box if you have Alternative Minimum Tax in association with this item, and enter AMT item(s) on that form.
  • Publicity Traded Partnership


Passive Income


Passive Activity Loss Rules
  • Apply to Schedule E, Parts I, II, & III.
  • May limit the amount of losses you can deduct.
  • Losses from passive activities may be subject first to the at-risk rules.
  • Losses deductible under the at-risk rules are then subject to the passive activity loss rules.
  • You can deduct losses from passive activities in most cases only to the extent of income from passive activities.



Passive Income or Loss:
Enter the gross amount before adjustment for Passive Activity Income or Losses and provide any prior year unallowed loss. 

(Ensure the applicable field is used when making your entries):
 - Passive Income Amount.
 -
Passive Loss Amount (enter as a positive number).
 -
Prior Year Unallowed Passive Activity Loss:


Passive Income Sold or Disposed:
Check the box if the property was sold or disposed of in the tax year.
 - Gain Due to Disposition:
 - Loss Due to Disposition:



Non-Passive Income:




Non-Passive Income or Loss:

  • Non-Passive Income Amount:
  • Non-Passive Loss Amount:
  • Non-Passive Section 179 Expense Deduction:




Self-Employment Earnings or Loss:


Income from a Farming or Fishing Partnership:
Check the box if this income is from a Farming or Fishing Partnership.


Income or Loss subject to Self-Employment Tax:
The amounts entered will be calculated into the total amount of Earned Income on the return, and also added to Schedule SE.
Enter loss amounts as a positive number.



Self-Employed Health Insurance:
A entry is only to be entered when:
  • You are a partner with net earnings from self-employment reported on Schedule K-1 (Form 1065).
  • You are a shareholder owning more than 2% of an S-Corporation and have a Form W-2 from this S-Corporation. (The EIN must be identical to qualify)



Enter the Net Profit and Any Other Earned Income From this Business:
Include Net Earnings and Gains from the Sale, Transfer, or Licensing of Property you created.
Do Not Include the following:
  • Capital Gain Income.
  • Shareholder owning more than 2% of an S-Corporation under which the Insurance Plan is established, the Earned Income is your Medicare Wages              (Box 5 of the Form W-2 from that Corporation).



Self-Employed Retirement Contributions:
Amount located within Schedule K-1 (Form 1065).
The system does not calculate the "Deduction Worksheet for Self-Employed" in IRS Publication 560.
Verifying Maximum Contribution Amounts is the users responsibility.



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