Why does TurboTax Kentucky Form 740, tax K-1 amounts twice? KY Schedule M, line 2 Schedule K-1 is taxed twice if K-1 info entered on this line.

[JulieS · Accepted solution]

Schedule M is used to adjust your income for Kentucky state tax purposes. You should not enter anything on line 2 of Schedule M unless there is a difference between the federal taxable income from K-1 and the KY taxable income from K-1.

For instance, if your Ordinary income from line 1 of your federal K-1 says $5000 and the Ordinary income from line 1 of your KY K-1 says $5000, there is no difference so no additions to income should be entered on Schedule M. 

To correct your return, review your state and change your answer to this question.

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