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Form 6198 At-Risk Limitations

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Form 6198 At-Risk Limitations

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Purpose of Schedule K-1

Although the corporation may have to pay a built-in gains tax and an excess net passive income tax, you are liable for income tax on your share of the corporations income, whether or not distributed, and you must include your share on your tax return if a return is required. Your distributive share of S corporation income is not self-employment income and it is not subject to self-employment tax.

For more information, see the Instructions for the Scedule K1-1120S on the IRS Website.
At Risk Limitations

Form 6198 is filed by individuals (including filers of Schedules C, E, and F (Form 1040)), estates, trusts, and certain closely held C corporations described in section 465(a)(1)(B), as modified by section 465(a)(3).

File Form 6198 if during the tax year you, a partnership in which you were a partner, or an S corporation in which you were a shareholder had any Amounts Not at Risk invested in an at-risk activity that incurred a loss.

For more information, see the Instructions for Form 6198 on the IRS Website.


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Views: 961 Created on: Jun 15, 2013
Date updated: Sep 02, 2015

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