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G
groffdavid
March 7, 2023
Question

K-1 Income being marked as passive when it is not

  • March 7, 2023
  • 1 reply
  • 0 views

I have K-1 income that is not passive, however, the system is marking it as such. How can I correct this?

1 reply

M
MinhT1
March 7, 2023

I assume that your K-1 Schedule is from a partnership or LLC.

 

For the income to be considered non-passive, you must answer that you materially participated in the partnership business activities.

 

You must answer Yes to the question Did You Participate? which is asked in the interview while entering your Schedule K-1.

 

Please revisit your Schedule K-1 and if appropriate, change the answer to that question.

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