Schedule K-1 Explained: Who Gets One & How to File It (2026)

If a business you're invested in just sent you a Schedule K-1, you may be staring at a dense form full of boxes and codes with no idea what to do next. Here's the reassuring part: a K-1 isn't something you file, and once you understand what it's telling you, it's straightforward. This guide explains what a Schedule K-1 is, the three versions you might receive, who gets one, and exactly how the numbers on it end up on your personal tax return.

What is a Schedule K-1?

A Schedule K-1 is a tax form that reports your share of the income, deductions, credits and other items from a business or entity that doesn't pay federal income tax itself. These are called pass-through entities, because the tax liability "passes through" the business to its owners or beneficiaries.

Here's the logic: a partnership or S corporation files an information return with the IRS reporting its total profit, but it doesn't pay income tax on that profit. Instead, it splits the profit among its owners and issues each one a K-1 showing their slice. Every owner then reports that slice on their own Form 1040 and pays tax at their individual rate. The K-1 is simply the document that tells you — and the IRS — what your slice is.

What are the different types of K-1?

"Schedule K-1" is really three different forms, each tied to a different kind of entity. The one you receive depends on what you're invested in:

K-1 version	Entity type	You receive it as a…
Schedule K-1 (Form 1065)	Partnership (incl. multi-member LLC)	Partner
Schedule K-1 (Form 1120-S)	S corporation	Shareholder
Schedule K-1 (Form 1041)	Estate or trust	Beneficiary

All three do the same job — report your share of the entity's tax items — but the layout and the codes differ. A multi-member LLC taxed as a partnership issues the Form 1065 version, which surprises some LLC owners who don't think of themselves as being in a "partnership."

Who gets a Schedule K-1?

You'll receive a K-1 if you hold a stake in a pass-through entity during the tax year. In practice that means you're one of the following:

• A partner in a general or limited partnership
• A member of a multi-member LLC taxed as a partnership
• A shareholder in an S corporation
• A beneficiary of an estate or trust that distributed income
• An investor in certain hedge funds, private equity funds or publicly traded partnerships

Sole proprietors and single-member LLCs do not get a K-1 — they report business income directly on Schedule C of their own return, because there's no separate entity splitting profit between owners.

What information is on a K-1?

A K-1 is organized into boxes, each carrying a specific type of income or deduction that flows to a matching line on your return. The most common items are:

• Ordinary business income or loss — your share of the entity's trading profit
• Rental and real estate income
• Interest, dividends and royalties
• Capital gains or losses
• Section 179 and other deductions
• Credits and, for partnerships, your share of liabilities and capital account

Each box also carries a code that tells your tax software or preparer where the figure belongs. Getting a single code wrong can misstate your income, which is why K-1s with lots of populated boxes are worth having a professional check.

How do you file a Schedule K-1?

Here's the point that trips people up most: you don't file the K-1 itself. The entity that issued it has already filed a copy with the IRS as part of its own return. Your job is to transfer the figures from the K-1 onto your Form 1040 and its supporting schedules.

Most K-1 items land on Schedule E (supplemental income), with dividends, interest and capital gains flowing to their usual schedules. You keep the K-1 with your records, but you generally don't attach it to your 1040. If tax has been withheld or a credit is reported, that's applied on your return too.

If your K-1 income leaves you owing tax that isn't covered by withholding, you may also need to make quarterly estimated payments during the year. Our quarterly tax calculator helps you estimate those, and our US tax service can prepare the whole return so the K-1 figures land in the right place.

When are Schedule K-1s due?

A partnership or S corporation must furnish K-1s to its owners by the due date of the entity's return, which for a calendar-year business is the 15th day of the third month after year-end — 15 March (moving to the next business day when it falls on a weekend, so 16–17 March in 2026). With a Form 7004 extension, that shifts to 15 September.

This timing matters because you can't finish your personal return without your K-1. A late K-1 is a common reason individuals file an extension of their own. Entities that file or furnish K-1s late face IRS penalties charged per owner, per month, so there's real pressure on the business to get them out on time.

Do you pay tax on income you didn't receive?

Often, yes — and this catches new investors off guard. You're taxed on your allocated share of the entity's income, whether or not it was actually distributed to you as cash. If a partnership earned a profit but reinvested it rather than paying it out, you still owe tax on your share. This is sometimes called "phantom income."

There's also an important difference in self-employment tax. A general partner's share of ordinary business income is generally subject to self-employment tax, whereas an S corporation shareholder's K-1 income is not — one of the reasons the S corp structure appeals to some owners. Which rules apply depends on your role and the entity, so it's worth confirming rather than assuming.

Frequently asked questions

Related: our US tax filing service and quarterly tax calculator. Official guidance is on the IRS Schedule K-1 pages.