K-1 Form 1041 Question

[Patrick Michael]

Client has a K-1 (Form 1041) for tax year beginning 4/1/13 and ending 3/31/14.  I never had a K-1 that was not a calendar year and was wondering if I include it in 2014's 1040 or do I have to amend their 2013 return?  I read through the instructions and don not see this in there.

 

Thanks.

[Gail in Virginia]

From the shareholder's instructions for Schedule K-1, on the IRS website:

 

The line numbers in the summarized reporting information on page 2 of Schedule K-1 are references to forms in use for calendar year 2014. If you file your tax return on a calendar year basis, but the corporation files a return for a fiscal year, report the amounts on your tax return for the year in which the corporation's fiscal year ends. For example, if the corporation's tax year ends in February 2015, report the amounts on your 2015 tax return.

 

Does this answer your question?

[Pacun]

Yes... it should. That's why when companies are adopting a fiscal year, they have to consider the least delayed reporting of income of its owners.

[Randall]

I agree with Gail of VA.  Not sure what Pacun was getting at.

[Patrick Michael]

Thanks for the help.

[Pacun]

I agree with Gail of VA.  Not sure what Pacun was getting at.

 

When you form a company and you want to have a fiscal year, you cannot select January 31st as your year end because that will delay income reporting for owners for a full year. So, if your company make a couple of millions of $, and it is distributed to you in Feb, you will have a whole year and more if you file in April of next year. I don't want to give the details because I assume you know what I mean.

 

Yes, the correct answer was given. I was adding that once you receive the K-1, you do nothing until it is time for you to file your taxes and even if you receive it in February, you wait a whole year before paying taxes on that money.

[Randall]

Pacun, I took the original question as an individual receiving a K-1 from a 1041 so I didn't get the connection of your first comment.

[TAXMAN]

Had a cpa once say look at the ending date on the K-1. That is the year you put it on your return unless calendar year.

[easytax]

When you form a company and you want to have a fiscal year, you cannot select January 31st as your year end because that will delay income reporting for owners for a full year. So, if your company make a couple of millions of $, and it is distributed to you in Feb, you will have a whole year and more if you file in April of next year. I don't want to give the details because I assume you know what I mean.

 

Yes, the correct answer was given. I was adding that once you receive the K-1, you do nothing until it is time for you to file your taxes and even if you receive it in February, you wait a whole year before paying taxes on that money.

 

If you wait the whole year, do you not then have the possibility of penalties and interest for NOT paying quarterly.  Would you/should you not pay estimated taxes, etc. to cover that possibility?