PTE(K): Kentucky Schedule K for Pass-Through Entities with Economic Development Project(s) (2024)
Kentucky · Kentucky DOR · Used for tax years 2024
Kentucky Form PTE(K) is a Schedule K for pass-through entities with economic development projects. It determines owners’ shares of income, credits, deductions, and other items excluding amounts attributable to those projects, and reports limited liability entity tax and apportion
Who files this form
A pass-through entity with one or more projects under any of the following programs must use Form PTE(K) instead of Form PTE Schedule K:
- Kentucky Rural Economic Development Act (KREDA)
- Kentucky Industrial Development Act (KIDA)
- Kentucky Jobs Retention Agreement (KJRA)
- Kentucky Industrial Revitalization Act (KIRA)
- Kentucky Jobs Development Act (KJDA)
- Kentucky Business Investment Program (KBI)
- Kentucky Reinvestment Act (KRA)
- Incentives for Energy Independence Act (IEIA)
- Incentives for Energy-related Business Act (IEBA)
- Farming Operation Networking Project (FON)
This schedule determines owners’ shares of income, credits, deductions, and other items, excluding amounts attributable to the economic development projects.
What you'll need
Have Form PTE and the relevant Schedules L and A available for the amounts referenced on this schedule. The printed instructions also refer to Form PTE Schedule K instructions.
Project attachments:
- Attach the applicable project tax computation schedules: KREDA-SP, KIDA-SP, KJRA-SP, KIRA-SP, KJDA-SP, KBI-SP, KRA-SP, IEIA-SP, IEBA-SP, or FON-SP.
- Attach supporting schedules for each project.
- If the entity has more than one project, attach a schedule showing how the total amount of each income or deduction item was computed.
Other attachments, depending on the items reported:
- Federal Form 8825 for rental real estate income or loss.
- A schedule of expenses from other rental activities.
- Federal Schedule D and Kentucky Schedule D, if applicable, for short-term or long-term capital gains or losses.
- Federal and Kentucky Forms 4797 for IRC § 1231 net gain or loss other than from casualty or theft.
- Federal and Kentucky Forms 4562 for the IRC § 179 expense deduction.
- Schedules for other portfolio income or loss, other income or loss, charitable contributions, portfolio-related deductions, other deductions, and items required to be reported separately to partners or shareholders.
- For general partnerships claiming the listed refundable credits, certifications for the certified rehabilitation, Kentucky Entertainment Incentive, or decontamination tax credit.
Common mistakes
- Using the regular Form PTE Schedule K. The form’s “IMPORTANT” notice says entities with projects under the listed programs must use Form PTE(K) instead.
- Leaving out project schedules. The instructions require the applicable tax computation schedules and supporting schedules for each project. Entities with multiple projects must also attach the computation of each item’s total.
- Not matching the owners’ Schedules K-1 to column (c). The instructions say the total pro rata share items on all Schedules K-1 should equal the amounts on the corresponding lines 1 through 23 of column (c).
- Overlooking Section B. The form labels the LLET pass-through items in Section B as required. General partnerships are instructed to use equivalent amounts to complete it.
Questions people ask
What goes in the three columns in Section A?
Complete column (a) using the Form PTE Schedule K instructions. For each income or deduction item, enter the amount attributable to the projects in column (b). Subtract column (b) from column (a) to get column (c).
What if the projects are the entity’s only operations?
For each item, the amount entered in column (b) should be the same as the amount entered in column (a).
How does this schedule affect owners’ Kentucky Schedules K-1?
Column (c) amounts are used to determine the income, credits, deductions, and other items reflected on each owner’s Kentucky Schedule K-1.
Who completes the refundable tax credit lines?
The refundable tax credit section is for general partnerships only. The instructions say to enter the refundable amount for the applicable credit. The listed credits are the certified rehabilitation, Kentucky Entertainment Incentive, and decontamination tax credits.