dmertz
Level 15

Deductions & credits

I see, then that wouldn't explain it.  There is no SE tax on that loss.  You didn't mention any amount in box 1, but if there is an amount in box 1, that amount added to your income.  Otherwise, I have no idea why adding the Schedule K-1 would reduce your refund.

 

I suggest comparing Form 1040 with and without the Schedule K-1 entered.