Tax Tip: READ YOUR K-1 CAREFULLY!

The IRS did a major redesign of the K-1 forms last year for S corporations and partnerships . These "pass through" entities don't pay taxes. Instead their income and expenses are reported to their owners on their K-1 forms, and the owners in turn report the K-1 information on their 1040s.

The new K-1s make some of the information harder to find. Many K-1s will have "charitable deductions" buried under "other deductions," usually as code "A" on box 12 of the S corporation K-1 or Box 13 of the partnership
K-1. If your K-1 comes from a farm or a manufacturing company, also look for a code "O" deduction for the so-called "Section 199 deduction." The the attachments thet came with the K-1s tell you what the items in the different boxes are.

If you don't have a copy of the instructions for a K-1 you can find them on the IRS’s web site: www.IRS.Gov

Don't lose a deduction just because it looks like some sort of footnote!