Clarification might be needed for what kind of income is on the K1 and then the type of entity. The fact that you are not a material participant is not the only factor.
Income and losses from the following activities would generally be nonpassive income:
- Salaries, wages, and 1099 commission income
- Guaranteed payments
- Interest and dividends
- Stocks and bonds (capital gains or losses)
- Sale of undeveloped land or other investment property
- Royalties derived in the ordinary course of business
- Sole proprietorship or farm in which the taxpayer materially participates
- Partnerships, S-Corporations, and limited liability companies in which the taxpayer materially participates
- Trusts in which the fiduciary materially participates
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