On Schedule K-1 (Form1065) what does line 19 Distributions refer to?

[JulieCo · Accepted solution]

Box 19 of the K-1 (1065) records distributions made to you, the partner or member, during the year. The distributions could have been cash or in other types of property.  Think of a distribution as being similar to a dividend as they are a reduction of capital/equity in the business.  If there was profit during the year, then distributions of the profit could be paid out to the members/partners.  But, a difference (generally) is that you are not taxed on the value of the distributions you receive, instead you are taxed on your share of the profit/loss of the business. Thus, a business can choose to not distribute all of its profit and allow some to be reinvested back in the business, but the member/partner will be taxed on their portion of the entire profit (since the business itself was not taxed on the income as it is a flow-through entity.)

Here is more detail of what the code means for box 19 on the K-1.

Code A. Cash and marketable securities. Code A shows the distributions the partnership made to you of cash and certain marketable securities.

Code B. Distribution subject to section 737. If a partner contributed section 704(c) built-in gain property within the last 7 years and the partnership made a distribution of property to that partner other than the previously contributed built-in gain property, the partner may be required to recognize gain under section 737. This gain is in addition to any gain recognized under section 731 on the distribution. When this occurs, the partnership will enter code B in box 19 of the contributing partner's Schedule K-1 and attach a statement that provides the information the partner needs to figure the recognized gain under section 737.

Code C. Other property. Code C shows the partnership's adjusted basis of property other than money immediately before the property was distributed to you.

[milpride]

In Turbo Tax, when you enter the distributions from K1s received from other partnerships, will the 19a on Form 1065-Schedule K be automatically populated? OR do we have to reenter the the distributions information again here?

Please advise.

[tagteam]

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@milpride wrote:

In Turbo Tax, when you enter the distributions from K1s received from other partnerships, will the 19a on Form 1065-Schedule K be automatically populated? OR do we have to reenter the the distributions information again here?

Please advise.

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See https://ttlc.intuit.com/community/business-taxes/discussion/form-1065-schedule-k-line-19a/01/850516

[ArmyNationalGuard70]

,OK, Thanks !

[Mde057]

i have a K-1 (final). where do i enter the amount on line 19 on my tax return.  i have my 1120S open and have already entered the ordinary business (loss). 

[PatriciaV]

Form 1120S Schedule K-1 Line 19 is used if the S-Corp has more than one activity for passive activity purposes. You should have also received a supplemental statement to help you determine your passive activity limitation. If you have answered all the questions in TurboTax about your participation in this S-Corp, there is generally nothing more you need to enter from Line 19.