SC1120S K-1: Shareholder's Share of SC Income, Deductions, Credits, etc. (Revision 2021-09)

Who files this form

The S Corporation prepares an SC1120S K-1 for each shareholder to show that shareholder's share of income, deductions, and credits, including amounts allocated or apportioned to South Carolina and other states.

The corporation must include the K-1s with its SC1120S Income Tax Return and provide a copy to each shareholder. Shareholders attach their copy to a paper Income Tax Return or keep it with their records if filing electronically.

What you'll need

To complete the form, have:

• The federal Schedule K-1 for amounts entered in column A, lines 1 through 12.
• The SC-K Worksheet. Its columns C, E, and F supply the shareholder's shares of South Carolina adjustments and amounts allocated or apportioned to South Carolina or other states.
• The corporation's FEIN, name, address, and ZIP code.
• The shareholder's identifying number, name, address, ZIP code, and percentage of stock ownership for the tax year. Individual taxpayers must provide their Social Security Number.
• The shareholder's South Carolina credit and nonresident withholding amounts, if applicable.

Attach an additional sheet if needed to list South Carolina tax credits.

How to file

For the S Corporation: Include the SC1120S K-1s with the SC1120S Income Tax Return. Provide an SC1120S K-1 to each shareholder.

For the shareholder: If filing a paper Income Tax Return, attach the SC1120S K-1. If filing electronically, keep the K-1 with your records.

The supplied text does not give a mailing address or electronic filing steps.

Common mistakes

Keep these filing reminders in mind:

• The S Corporation must both include the K-1s with its SC1120S return and provide a K-1 to each shareholder.
• Shareholders filing on paper must attach the K-1. Those filing electronically must keep it with their records.
• Individual taxpayers must provide their Social Security Number on the form.

Questions people ask

How are South Carolina adjustments shown?

Enter the shareholder's share of South Carolina adjustments from SC-K Worksheet, column C, in K-1 column B, lines 1 through 12. Show additions as positive numbers and subtractions in brackets as negative numbers.

What does the Active Trade or Business election box mean?

The S Corporation checks this box if it elects to pay tax on active trade or business income at the entity level. The election is made by the corporation and applies to all shareholders. Line 13 reports the shareholder's share of that income taxed by the corporation.

What withholding rules apply to nonresident shareholders?

The instructions require S Corporations to withhold 5% of nonresident shareholders' South Carolina taxable income and enter the withholding on line 15. The corporation must provide a federal 1099 MISC with “South Carolina Only” written at the top, showing the income and tax withheld. If a nonresident is exempt because they filed an I-309 affidavit with the corporation or are included in a composite return, check the appropriate exemption box.

How is net taxable income calculated?

For line 14, add column D, lines 1 through 10, then subtract the amounts on lines 11, 12, and 13.

Official sources

• https://dor.sc.gov/sites/dor/files/forms/SC1120SK1.pdf