How do I input Ordinary Income received with a lower-tier partnership Schedule K-1 into the Schedule K-2 part II, section 1, where there is no Ordinary income line, with a 1065 and 1120S return, using CCH® ProSystem fx® Tax and CCH Axcess™ Tax?

  • Article Type:
  • How To
  • Last Modified:
  • 07/01/2022

Objectives

Populate Schedule K-2 and Schedule K-3 for Ordinary Income received from a lower tier partnership K-1 for a 1065 return.

Environment

  • CCH® ProSystem fx® Tax
  • CCH Axcess™ Tax
  • Partnership - 1065
  • S Corporation - 1120S

Procedure

  • Software support can only advise to input the amounts received from the lower-tier Schedule K-3 into the Schedule K-2 input.
  • When we are preparing Schedule K-2 for information received from a lower tier passthrough, then there should have been a Schedule K-3 also received with the necessary gross income amounts and country codes to properly pass that information through again.
  • If your S-Corp and/or Partnership client is required to prepare Schedule K-2 and K-3(s), and they received a Schedule K-1 from a lower-tier partnership, but they did not receive a Schedule K-3 along with that K-1, then you will want to contact the preparer of the lower-tier partnership to get that information for the S-Corp and / or Partnership return which you are preparing.

Additional Information

N/A

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