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Reporting K-1 income

New Jersey law requires that pass-through entities supply a New Jersey Schedule K-1 showing the income calculated under New Jersey law, that's then reported on the individual's New Jersey return.
In scenarios where the pass-through entity didn't issue the taxpayer a New Jersey Schedule K-1, worksheets are available to calculate the New Jersey income according to Publication GIT-9P and GIT-9S. Follow UltraTax CS's data entry steps based on how the New Jersey income is reported to the taxpayer.

Taxpayer received NJ Schedule K-1

If a taxpayer has a New Jersey Schedule K-1 from either an S corporation or partnership and it was prepared in UltraTax CS, the New Jersey information will data share into the individual New Jersey return.
If the New Jersey Schedule K-1 wasn't prepared in UltraTax CS, enter the following data:
Residents
  • If the taxpayer is a resident of New Jersey, enter the S corporation NJ Schedule K-1, line 3, or partnership NJ Schedule K-1, line 4, column A, on the federal
    K1-2
     screen in the
    Ordinary business income - State, if different
     field, or in the NJ column of the allocation grid.
Part-year or nonresidents
  • If the taxpayer is a part-year resident or nonresident of New Jersey, enter the S corporation NJ Schedule K-1, line 3, or partnership NJ Schedule K-1, line 4, column A, on the federal
    K1-St
     screen in the
    Ordinary income everywhere (New Jersey)
     field.
  • On the federal
    K1-2
     screen, enter the New Jersey source amount from the S-corp NJ K-1, line 1, or partnership NJ K-1, line 4, column B, in the
    Ordinary business income - State, if different
     field.
note
If the K-1 is coded to a state other than New Jersey (via the
State postal code
 field) enter the New Jersey source amount in the Allocation grid.

Taxpayer didn't receive NJ Schedule K-1

If the taxpayer doesn't have a New Jersey Schedule K-1, you'll need to convert the federal Schedule K-1 income into New Jersey income based on the Publication GIT-9S for an S corporation, or GIT-9P for a partnership.
Worksheets are available to help you calculate NJ income. The worksheets calculate based on the GIT-9S/GIT-9P instructions and will generate when the State, if different columns are blank on the federal input screens for K1.
Amounts entered in the federal columns of the federal K1 through K1-7 screens will transfer to the
NJK1Wrk
 screen, in the
New Jersey K1 1065, 1120S
 folder. Additional data entry is required on this input screen for an accurate calculation since some adjustments aren't applicable (thus no fields are available in the federal input screens) to the federal K-1. You can also overrule amounts that transfer to this screen based on data acquired from the S-corporation or partnership.
note
In UltraTax CS 2015 and earlier, the worksheets are available in the
Non-calculating
 folder.
Part-year residents:
 UltraTax CS will automatically prorate the federal K-1 amounts that transfer to New Jersey when part-year residency dates are entered in the
NJNRPY
 screen in the
Income & Adjustments
 folder.
restriction
If amounts are also entered in the
State, if different
columns for NJ, the worksheet won't calculate.
If the taxpayer doesn't have a New Jersey Schedule K-1 and you don't want to use the worksheets to convert K-1 income into New Jersey source amounts, enter code
2
 in the
Source of New Jersey K-1 income
 field on the
NJK1
 screen and follow the preceding data entry steps as if the taxpayer had received a New Jersey K-1, using the net taxable amount instead.
Internal use only
  • There's no need to answer legal questions on the worksheet.
  • The main purpose of the
    Source of New Jersey K-1 income
     field on the
    NJK1
     screen is to control the calculation of the worksheet. When a user calls and asks, "How did we calculate K-1 income?" you can go to this field and answer the question based on the number there. If the field is blank, the unit may be inactive for the year. Otherwise, we used whatever amount they entered on the
    Ordinary business income, State if different
     field on the federal
    K1-2
     screen.
  • If the
    Ordinary income everywhere (New Jersey)
     field is grayed out on the
    K1-St
     screen, the K1 is coded to another state other than New Jersey and multiple units of the
    K1-St
     screen will create for each state. Make sure you're on the NJ unit.

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