Do not enter the K-1 for the investment held by your IRA. You don't have to worry about income (or losses) reported on your IRA's K-1. However, you could have an issue with Unrelated Business Income (UBI). The amount of unrelated business income from your IRA's partnership investments will be listed as such in Box 20 of the K-1 form. Only the amounts of unrelated business income are important concerning taxes and your IRA account.
If your IRA earns more than $1,000 in unrelated business income as reported on the K-1s you received, the IRA must pay unrelated business income tax – UBIT – on the amount above the $1,000 cutoff. Not all of the distributions you receive from MLP investments will be UBI, and many partnership investments will report little or no UBI on the K-1s they send out. If the K-1s you received total to less than $1,000 in UBI, there is nothing you need to do. With more than $1,000 in UBI you need to contact your IRA custodian. If the amount of UBI is more than $1,000, then the custodian of your IRA will need to complete and file a tax return in the name of your IRA account.
To repeat, if the total UBI for the IRA is $1,000 or less, you don't have to do anything.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
