Partnership issed K-3 form for domestic activity

Forum|Forum|3 years ago
March 27, 2023
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I have invested some money in an investment company, which in turn invests in other asset classes and issues K-1 form to partners. This is first year for me with them. Their activity is 100% domestic. They issued form K-1 and also K-3 for me. On part 2, section 1, line 24, they mention country as "US". When I try to enter K-3 in TurboTax, it asks me for country code, but the list does not contain "US" (I think because it is domestic only). When I asked investment company why they issued K-3 for domestic activity, they replied me as follows:

"THE PARTNERSHIP'S ACTIVITY IS 100% DOMESTIC. THE SCHEDULE K-3 INFORMATIONAL DISCLOSURE IS A NEW IRS REQUIREMENT FOR 2022. IF YOU HAVE NO FOREIGN ACTIVITY,
IT MAY NOT BE NECESSARY TO INCLUDE THIS INFORMATION AS PART OF YOUR PERSONAL TAX RETURN.

Any idea how shall I enter K-3 in TurboTax?

LindaS5247

If you have no other foreign income or foreign tax credits to report on your return you do not have to include the K-3. Keep it with your tax records.

Otherwise, to enter, switch to "Forms Mode", Type "K-3" in the box (top left). You will see this:

Click "Next" and you will see this:

Click "Finish" and you will see this:

Depending which version of TurboTax you have you can also try this to enter the K-3:

Open the Schedule K-1 Worksheet.
Scroll down to the Foreign Transactions line: For partners, this is line 16. For shareholders, this is line 14.
Check the Schedule K-3 is attached if checked box.
Enter the Name of Country or U.S. Possession.
Complete lines B through AI based on the K-3 received.

If this does not help please feel free to come back to TurboTax Community with additional questions or click here for information on Turbo Tax Support. You can connect with a Live TurboTax Agent and share your screen.

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katrivedi02Author

Thank you for your answer on this. So, I will say No to the question for box 16 in TurboTax, even if I received K-3. Is my understanding correct?

AbrahamT

That is correct. K-3 was developed for the purposes of international reporting requirements which used to be part of a K-1. So, if you don't have anything of an international nature to report, just leave it alone. See HERE #2 for more detail.