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No, the partnership won't get in trouble because you don't yet have your K-1

March 28, 2009

So you don't have your K-1 yet. You have all of your 1099s. You have a mind to threaten to snitch to the IRS on them - don't they know that stuff is all supposed to be out by the end of January?

No, they don't know that, because it's not true. The deadline for issuing 1099s for S corporations is March 15, and it's April 15 for calendar-year partnerships and trusts. What's more, all of these deadlines can be extended to September 15.

Why is it so hard to get a K-1 out? It's because they often have to carry the whole income of a business to sometimes dozens, or even hundreds, of 1040s.

Pass-through entities -- partnerships and S corporations -- don't pay taxes on their own income; the owners pay the tax. If you have an operating business, this can get complicated and require some time to sort out before the K-1 can be issued.

Trusts and Estates also have K-1s; these entities can pay their own tax, but if they make distributions for the beneficiaries, the distributions carry the taxable income with them; the K-1s report how much income is carried out to the beneficiaries.

We'll be talking about how to use K-1s on your tax returns over the next few days. Don't miss any of these installments in our 2009 filing season tips series

Tags: Tips for filing 2008 returns.