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New Member

CA K-1 issued to IRA non-resident

I received a Schedule K-1 for an investment in an IRA account for CA activity.  I am not a resident of CA.  Are the earnings taxable to California?  If not, what about when distributions are made at a later date?

2 Replies
Level 15

CA K-1 issued to IRA non-resident

@Pammer1 anything that 'slosses' around within an IRA has no tax reporting requirement or implication,  When you eventually distribute money out of the IRA, there will be ordinary income tax, assuming you are at least 59.5 years old (under 59.5, with few exceptions there is a 10% penalty as well)

New Member

CA K-1 issued to IRA non-resident

On the federal level, if there is more than $1,000 of UBI (unrelated business income), the custodian of the IRA files a tax return and the IRA pays any taxes due.  The UBI appears in box 20 of the K-1.

The earnings were made in CA and even though there is not an IRA distribution, it seems CA will find a way to get their share of taxes on earnings made from a CA partnership.

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