Schedule K-1 (Form 1120-S): Schedule K-1 (Form 1120-S) (2025)
Federal · IRS · Used for tax years 2025
Schedule K-1 (Form 1120-S) reports a shareholder’s share of the corporation’s income, losses, deductions, credits, and other tax items for 2025. It also includes information about the corporation, the shareholder’s ownership, and loans from the shareholder.
Who files this form
The S corporation uses Schedule K-1 to report a shareholder’s share of its income, deductions, credits, and other items. The corporation files a copy with the IRS.
As a shareholder, include your share on your tax return if you are required to file one. You may owe tax on the corporation’s income even if it did not distribute that income to you.
Generally, keep Schedule K-1 for your records rather than filing it with your return. The exception is when box 13, code O, reports backup withholding.
What you'll need
Have these records available when reporting your Schedule K-1 items:
- Your Schedule K-1 and any attached statements explaining coded items or separate activities.
- Records needed to figure your stock and loan basis. The instructions generally direct you to use Form 7203 to calculate these amounts.
- Records of prior-year losses, deductions, or credits that you could not use because of applicable limitations.
- Any Form 8283 the corporation provides for noncash charitable contributions. You must complete your own Form 8283 and attach the corporation’s copy to your return as instructed.
Depending on your situation, you may also need Form 6198 for at-risk limitations, Form 8582 for passive losses, or Form 8582-CR for passive credits.
How to file
The corporation files a copy of Schedule K-1 with the IRS. Shareholders generally keep their copy and report the items on the appropriate lines of their tax return, after applying any required limitations.
Do not file Schedule K-1 with your return unless box 13, code O, reports backup withholding.
The supplied text does not give a mailing address or e-file procedure for Schedule K-1.
Common mistakes
- Deducting every loss shown without checking limits. Your allowable losses and deductions may be less than the amounts on Schedule K-1. Apply the basis, at-risk, passive activity, and excess business loss limitations in that order, as applicable.
- Changing an incorrect K-1 yourself. Ask the corporation for a corrected Schedule K-1 instead. Make sure it sends the corrected copy to the IRS.
- Reporting items differently without explaining why. Generally, report items consistently with the corporation. If inconsistent treatment requires Form 8082 and you do not file it, an accuracy-related penalty may apply.
- Counting a guaranteed loan as loan basis without making a payment. Merely guaranteeing or co-signing a corporate loan does not give you loan basis. Also, distributions do not reduce loan basis.
Questions people ask
Do I owe tax if the corporation did not pay me the income?
You may owe tax on your share of the corporation’s income whether or not it was distributed. Include your share on your return if you are required to file one.
Is my share of S corporation income subject to self-employment tax?
No. Your share of S corporation income is not self-employment income and is not subject to self-employment tax.
What does “STMT” mean on my K-1?
It means the corporation provided information on an attached statement because the item cannot be reported as a single dollar amount. An asterisk can also indicate an attached statement with additional information.
Why does my K-1 show only part of my identifying number?
For your protection, the K-1 may show only the last four digits. The corporation has reported your complete identifying number to the IRS.
Does Schedule K-1 show actual dividend distributions paid to me?
No. The corporation must report actual dividend distributions totaling $10 or more for the calendar year on Form 1099-DIV.