Specially allocate Schedule K items to shareholders in an 1120S return
Specially allocate Schedule K items to shareholders in an 1120S return by ratio or by amount.
You can allocate all Schedule K-1 items by a specified ratio, or you can allocate each item individually. The application displays the Schedule K total at the top of the screen, and you can set up the allocation by amount or by ratio when you allocate an individual item.
- Go to .
- Choose how to allocate the Schedule K items:
- Allocate all Schedule K-1 items together by a specified ratio.
- Go to the item to allocate it individually.
- If you are allocating an individual item, set up the allocation by amount or by ratio.
The application allocates the Schedule K item to shareholders according to the amounts or ratios you enter.
The allocation code Total generally equals 1.0 when you use ratios, or equals the Schedule K amount when you use amounts. However, you may need to specially allocate only a portion of the Schedule K amount. Use one of the following 2 methods for a partial special allocation:
- Residual: The application specially allocates part of the total Schedule K amount, then allocates the remainder to the shareholders who are not receiving the special allocation, computed using their ownership ratio.
- Piggyback: The application specially allocates part of the total Schedule K amount, then allocates the remainder to all shareholders using ownership ratios, including the shareholders who are receiving the special allocation.
note
The Total can never exceed 1.0 (when using ratios) or the Schedule K amount (when using amounts).
