Schedule K-1
The form used by partnerships and multi-member LLCs to report each member's share of income, deductions, and credits.
Definition
Schedule K-1 (Form 1065) reports each LLC member's allocated share of the partnership's income, deductions, credits, and other tax items. Issued annually to each member as part of the partnership's Form 1065 filing. Members use the K-1 to prepare their personal tax returns.
Context
K-1 issuance is automatic when an LLC files Form 1065. Foreign members receive K-1 plus potentially Form 8805 (foreign-partner withholding statement).
Example
A multi-member Delaware LLC issues Schedule K-1 to each of its three members in March, before the April 15 deadline. Each K-1 shows the member's allocated share of the LLC's $200,000 net income for the year.
Common pitfalls
- K-1s often arrive close to or after the April 15 deadline; members may need to file extensions.
- Foreign members face additional withholding rules that affect K-1 timing and content.