Partnership K-1 not triggering self-employment tax or deduction for SEP contribution.

[pezdavis2]

I'm a general partner in a partnership and entered my K-1 data - Box 1 income from business, and box 13 R for a SEP contribution. I believe that my box 1 income should incur self-employment tax, but nothing shows up on 1040 Schedule 4, and no Schedule SE is created in TT. I'm using TT Deluxe on a Mac (download, not online), and have triple checked that I've completed the K-1 interview and checked as general partner.

On top of that, it looks like my SEP contribution is not being treated as pre-tax. TT does create a Keogh/SEP worksheet and enters a single figure (Line 4b/c) for my contribution, but doesn't seem to do anything else with it. Am I missing something?

Thanks for any help you can give, this is driving me nuts!

[dmertz · Accepted solution]

This suggests that your Schedule K-1 (Form 1065) is missing the code A entry in box 14 that is necessary to report the amount of the income on the K-1 that is income from self-employment.

[SSoph]

So if the K-1 is missing this data, we're entering and then it will carry to Schedule E to obtain the self-employment tax.  What amount do you enter, the ordinary income or the net of the income less the unreimbursed expenses?

Please advise

[AmeliesUncle]

@SSoph   If the K-1 is missing the data, you need to go back to whoever prepared the Partnership return to correct it.

[IslandBoy19]

I have the same problem and I am using TurboTax Business to create the K-1. After entering the 1065 info my wife's K-1 shows a code A in box 14 with an amount. My K-1 shows nothing in box 14 so that's one mystery and I do not get presented with a hard you have to fill in Sched C.  

In TT Business, I am asked IF i need to fill out a SE worksheet and does not offer clear instruction on what to enter. I assume it is our net profits but I am not sure. 

[Rick19744]

Your issue most likely stems from how Schedule K-1 Part II box G is marked.

If this is marked as limited partner or other LLC member, then TT will not subject the earnings to SE at the 1065 level.

This is a long, complicated and technical issue that is well beyond the scope of a forum such as this.

You are dealing with two different situations:

• The 1065 level
• The 1040 level

If you are completing the 1065 and believe the earnings should be subject to SE and reported in box 14 code A, then you need to mark the box G as general partner or LLC member-manager.

[IslandBoy19]

I found that somehow the program thought I was a limited or non participating member and that caused my income not to make the SE worksheet. 

I had to delete my member info and create that record again and the program updated.