Which schedule is used to report income for partners in a partnership?

Prepare for the Intuit Academy Tax Level 1 Exam. Study with flashcards and multiple choice questions, each question includes hints and explanations. Ace your exam and advance your tax knowledge!

The correct answer is Schedule K-1, which is specifically designed for partnerships to report income for individual partners. Each partner receives a K-1 form that details their share of the partnership's income, deductions, and credits. This information is crucial for partners when they prepare their personal tax returns, as the income reported on the K-1 is passed through to their individual tax filings.

Partnerships themselves do not pay taxes at the entity level; instead, they pass income, losses, deductions, and credits through to their partners. This pass-through nature of partnerships is a fundamental concept in partnership taxation, which Schedule K-1 reflects.

The other schedules mentioned serve different purposes. Schedule A is used for itemized deductions, Schedule C is for reporting income or loss from a sole proprietorship, and Schedule E is generally used for supplemental income and loss, such as rental income or royalties, but does not specifically serve the context of reporting income for partners in a partnership. Therefore, Schedule K-1 is the correct choice as it directly addresses the income reporting for partners within a partnership structure.

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