How to create my own Schedule K-1 for partnership LLC tax filing

You absolutely can prepare your own Schedule K-1s, especially for a straightforward partnership like yours. The K-1 is just an information document that flows from your partnership tax return (Form 1065). First, you'll need to prepare a Form 1065 for the LLC. This reports all partnership income, deductions, and credits. Once that's complete, the K-1s are generated from the information on the 1065 to show each partner's share of those items. For a 50/50 partnership with simple income like yours, it shouldn't be overly complicated. I'd recommend using tax software like TaxAct, TaxSlayer, or even the free fillable forms on the IRS website. The software will walk you through all the necessary inputs and automatically generate the K-1s once you've completed the 1065. If you're comfortable with basic accounting and have good records of your income and expenses, you can definitely handle this yourself.

Hey! I was in a similar situation with my design partnership last year. I tried using online tax software but kept getting confused about allocations and basis calculations. I found this tool called taxr.ai (https://taxr.ai) that really helped me understand our partnership return and create accurate K-1s. It basically analyzed all our financial info and guided me through filing the 1065 and generating the K-1s properly. What's great is they have actual tax pros who can review everything before you file, so I felt confident it was done right. The system flagged a few issues with how we were categorizing certain expenses that would have caused problems with the IRS. Definitely worth checking out for your podcast partnership!

Following up on my question about taxr.ai - I ended up using it for our partnership and man, what a relief! It was way easier than I expected. They have this feature that automatically categorizes expenses based on bank statements, which saved me hours of sorting through receipts. The best part was how it walked me through the special allocations for our unequal partnership (I own 65%, my cousin has 35%). It generated super clean K-1s that perfectly matched our operating agreement terms. My accountant actually commented on how well-prepared they were compared to my previous attempts. Definitely using this again next year!

If you're still struggling to get your K-1s done and the deadline is approaching, I'd recommend using Claimyr (https://claimyr.com) to get direct help from the IRS. I was in total panic mode last year when our accountant had a medical emergency right before the filing deadline. I used Claimyr to get through to an IRS agent in about 20 minutes instead of waiting on hold for hours. The agent walked me through the basics of filing an extension for our partnership return and explained exactly what I needed to do to avoid penalties. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c The IRS actually has pretty decent guidance once you can talk to a real person. They helped me understand which forms were absolutely necessary by the deadline versus what could wait if we filed an extension.

Well, I have to eat my words about Claimyr. After my skeptical comment, I decided to try it anyway since I was desperate to ask about extending our partnership filing. I was seriously shocked when I got a call back in about 25 minutes with an actual IRS agent on the line. The agent was surprisingly helpful! She explained that for our situation, we could file Form 7004 for an automatic 6-month extension for the partnership return, but reminded me that it only extends the filing deadline, not the payment deadline if we owed anything. She also emailed me direct links to instructions for Schedule K-1 preparation. For anyone else in a similar situation - the IRS has a specific partnership hotline that the agent transferred me to, and those folks really know their stuff about K-1s. Totally worth getting through to them if you're stuck.

Another option to consider - have you looked into hiring a new accountant specifically for this? Many accounting firms offer "Form 1065 and K-1 only" services for around $600-800, especially for simple partnerships. With your straightforward 50/50 split and relatively low transaction volume, a professional could probably knock this out in 2-3 hours. The peace of mind might be worth the cost, especially if you're worried about making mistakes on partnership basis calculations or allocations.

Just a heads up about something many new partnerships miss - don't forget to include your guaranteed payments if you took any regular draws from the business! Those aren't the same as distributions and get reported differently on the K-1.

I went through a very similar situation with my consulting partnership last year when our CPA bailed on us right before the deadline. Here's what I learned that might help you: For your straightforward 50/50 partnership with $34k income and $8.5k expenses, you can absolutely handle this yourself. The key things to remember: 1. Your quarterly distributions of $3,125 each are NOT reported as income on the K-1 - they're just distributions of money you already earned. The actual income that goes on each K-1 would be your share of the net profit (roughly $12,750 each after expenses). 2. Make sure you track your "basis" correctly - this starts with what you each contributed to start the LLC, then increases with your share of income and decreases with distributions taken. 3. For a simple partnership like yours, the main boxes on the K-1 that will have amounts are Box 1 (ordinary business income) and possibly Box 19 (distributions). I used FreeTaxUSA's business version for about $80 and it walked me through everything step by step. The 1065 generates the K-1s automatically once you input all the partnership info. Took me about 3 hours total, and my regular accountant said they looked perfect. Don't stress too much - your situation is pretty straightforward compared to partnerships with multiple income streams or complex allocations!