The short answer
A Schedule K-1 reports your share of income, losses and credits from a partnership, LLC, S corporation, trust or estate. You owe tax on your share whether or not you received any cash. They often arrive in March or later, so an extension is common.
Last reviewed: October 2026
This page explains how taxes and reporting work. It isn't a recommendation to buy, sell or hold any investment.
Where K-1s come from
- Partnerships and most LLCs (Form 1065)
- S corporations (Form 1120-S)
- Trusts and estates (Form 1041), including inheritances still being settled
- Publicly traded partnerships, like many energy and pipeline investments
Why they're late
The business has to finish its own return first. Partnership and S corporation returns are due March 15, and many extend. Corrected K-1s are common too, which is why waiting can beat filing and amending.
Floridians and other states
Florida has no income tax, but if the business earns income in a state that does, you may have to file a return there. Some businesses file a group (composite) return for owners, and some states have minimums before you must file. We check each one.
Things that trip people up
- Losses may be limited by your basis, your amount at risk, or passive activity rules.
- Cash distributions aren't the same as taxable income. You can owe tax with no cash, or get cash that isn't taxed.
- Selling a partnership interest can create ordinary income even when you think you have a loss.
Official source: IRS: About Schedule K-1 (Form 1065).
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Disclaimer: This page is general information, not tax advice. Every situation is different, and tax rules change. Reading this page doesn't make you a client.