Schedule O (Partnership): Nonoperational Activity (2025)
New Jersey · NJ Division of Taxation · Used for tax years 2025
New Jersey Schedule O (Form NJ-1065) separates a partnership’s nonoperational income from its operational income. It calculates net nonoperational income and New Jersey’s taxable portion, and lists the states where nonoperational income is assigned.
What you'll need
Have these items ready to complete Schedule O:
- The partnership name as shown on Form NJ-1065 and its federal EIN.
- Federal Schedule K, or Schedule A, Part I, Column C, if applicable, for Part I, Column A.
- Income, additions, and subtraction amounts for the operational and nonoperational columns in Part I and the activity columns in Part II.
- A schedule showing the calculation of New Jersey’s taxable portion, which must be attached for Part II, line 16.
- The states where nonoperational income is being assigned, for Part II, line 17.
Common mistakes
- Completing the forms out of order. Schedule O says to complete it before Form NJ-1065 and after Schedule A, if applicable.
- Leaving out the calculation attachment. Part II, line 16 requires an attached schedule showing the calculation of New Jersey’s taxable portion.
Questions people ask
What does Schedule O calculate?
Part I calculates the nonoperational activity elimination. Part II calculates taxable nonoperational activity.
What goes in the three columns in Part I?
Column A uses Federal Schedule K amounts, or Schedule A, Part I, Column C, if applicable. Column B is for nonoperational amounts, and Column C is for operational amounts.
Where do I report New Jersey’s taxable portion?
Part II, line 16 says to enter the Total column amount on Form NJ-1065, line 20, Column B. Attach a schedule showing the calculation.
Do I need to identify the states receiving assigned nonoperational income?
Yes. Part II, line 17 asks you to list the states where nonoperational income is being assigned.