probably wording similar to below was included with your k-1
The passive activity loss limitations provide that individuals and some other types of investors that do not meet certain business participation
thresholds may only deduct losses from these activities to the extent of the taxpayer's income from such activities. One of the unique tax issues related to investments in PTPs provides that the passive activity loss limitations are generally applied separately with respect to each PTP that is owned by the taxpayer. However, the application of the passive loss limitations to tiered PTPs is not entirely clear, so you should consult your personal tax advisor as to whether you are subject to the passive loss limitations, and if so, how the information presented below should be reported on your federal and state income tax returns.
so you see no one knows the correct answer because the IRS hasn't addressed the issue.
so I'll give you two options but there is no support for either of these
1) ignore all the subentities report everything based on the master k-1
2) aggregate them depending on whether they reported income /loss on line 1, 2, or 3 . thus at most you would end up with 3 k-1's
in other words, if 10 entities reported on line 1, 15 on line 2, and 5 line 3
you would aggregate every line for each line for the 15 entities reporting on line 1 and report on the 1st k-1
you would aggregate every line for each line for the 20 entities reporting on line 2 and report on the 2nd k-1
the same for the other 5 on the 3rd.
