How to enter K-1 with Part III amount in Box 1 and 2 AND Box 22 checked AND schedule of separate passive activities

[fylgir]

Hi everyone,

My first time dealing with a K-1, I am very confused. Please help!

I already read that a K-1 with amounts in Box 1 and 2 in Part III needs to be entered as 2 separate K-1's - using the same info from Part I and Part II.

Now, this K-1 has Box 22 checked and a K-1 supplemental statement.

Printed across Part III: "Do not use Part III Info - See supplemental K-1 statement"

The supplemental statement lists 3 different entities (let's say A, B and C), the first one (A)  being the entity on my K-1 form with the Part I and II info. The supplemental statement says "schedule of separate passive activities". All 3 have the same type of activity, are marked as PTP and marked as "Pass-through". Below that I see three columns - one for each entity - reporting the information for Boxes 1 to 20. Entity A has the most entries in Box 1 to 20. Entities B and C have some very small amounts each, a fraction of A. How do I enter this? 

I don't have Part I and II for entities B and C. Do I just consolidate and file 2 K-1's for entity A? Not sure what to do...

Thank you for your help! It is greatly appreciated!

Ken

[nexchap]

Losses from a PTP can only be recognized when that same PTP has gains.  That's true even when a parent PTP owns shares in a bunch of subsidiary PTPs.  As a result, you have to treat each of A, B, and C as though you got separate K-1s.

Note that if you add across each row, the total for A, B, and C should match what's reported on the "overall" summary K-1 that has box 22 checked.

As far as Part I and II go, the name and FEIN are generally the only things that carry over to your filed returns.  The rest is for your records.

[fylgir]

Thank you nexchap for your quick response. 

Ah, ok, that's how it needs to be entered. Thank you, makes sense now.

Ken

[fylgir]

@nexchap  Sorry, got one follow-up question now where I'm entering the information.

I'm entering 3 separate K-1's, one for A, one for B and one for C.

I'm at the point where TT states "We see you have Section 199A income". For entity A, since this is the partnership that issued the original K-1, I selected "The income comes from the partnership that generated this K-1". How about entity B and C? Is that the same selection or do I choose "The income comes from another business"? Sorry that option confused me, that's why I'm not sure.

Thank you again!

Ken

[nexchap]

@fylgir Its the same for B and C.  The 199A income you report for them also came from them, so that's what you answer.

[fylgir]

Awesome, thank you @nexchap 

Ken