Do we need to report Final Schedule K-1 (form 1065) if final distributions were reported on W2 and taxed?

[JUKEBOX2]

I received a Final Schedule K-1 form for 2020 as the partnership ended in 2020 (Cash distributions were made and taxes on those withheld). 

I am trying to understand if I still need to report Final Schedule K-1 given that all the distributions were reported on W2 and the Federal and State taxes on that was withheld. Should I just leave Final Schedule K-1 out from my tax return now?

[JamesG1]

If you leave the K-1 out of your 1040 personal tax return, do any balances change?  Do any carryovers change?  It is possible, that the IRS may still inquire why the document was not reported.

[JUKEBOX2]

Thanks for your response @JamesG1 .

I just tried adding the Final Schedule K-1 to my tax returns in turbo tax and it shows that I owe additional federal and state taxes. Do you know why would that happen given that the partnership ended in 2020 and all the distributions were taxed as income on W2? I also see that my Final-K1 has 8. Net short-term capital gains (loss)
9a. Net long-term capital gains (loss) reported.

[JamesG1]

You would have to ask the preparer of the K-1 why those capital gains entries are there and were not reported previously.

Capital gains in boxes 8 and 9 of the partnership K-1 could be taxed anywhere from 0% to 35% on the Federal tax return based upon a great number of things.

You should see ST on line 5 and LT on line 12 of the Federal 1040 Schedule D.  No other entries in boxes 1-20?

[JUKEBOX2]

Thanks @JamesG1 , I looked up 2019 1040 Schedule D and line 5 is empty and line 12 says 39.

For 2020 Schedule K1:

-- Part II --

J has beginning and ending %

L has capital account numbers

N has partners share of 704c gains or loss

-- Part III --

8 has net short term capital gain

9 has net long term capital gain

13 has W other deductions value

16 has foreign transaction A, B, C, M, AA

19 has distributions A, C

Rest of the fields are all empty.

[JamesG1]

To answer your original question, you should report this K-1 on your 2020 Federal 1040 tax return.