Received 2022 Schedule K-3 Available in June But Taxes Due in April - What Do I Do Now?

Thanks for the info! The K-1 does show some foreign tax credits in Box 16, so I'm guessing I really do need that K-3. How do I estimate what I might owe if I don't have the complete information yet? Is there some standard percentage I should calculate? Also, is there any penalty for filing an extension? I've never had to do that before.

For estimating your taxes when you're missing information, look at last year's return as a starting point if your situation is similar. For foreign tax credits specifically, if the amount is similar to previous years, use that as your estimate. There's no penalty for filing an extension as long as you pay at least 90% of what you end up owing by the April deadline. The extension itself is simply a form you file - either electronically or by mail - and it's automatically granted. Many people file extensions every year, it's quite common especially for those waiting on K-1s and other complex investment forms.

How does this taxr.ai thing work? Is it just another tax software or something different? I'm dealing with my first K-1 ever and had no idea about this K-3 business until reading this thread.

I'm skeptical about using any automated tool for something as specific as K-3 forms. How can it possibly know what to do when the actual form isn't available yet? And what happens if you end up owing more than what the tool estimated?

It's different from regular tax software. You upload your tax documents and it uses AI to analyze them and tell you exactly what's missing or what you can do with incomplete information. In my case, it identified that only 3 of the foreign items on my K-1 actually needed K-3 details, so I could proceed with the rest. If your estimates are off, you'd still need to pay any differences when you file your complete return. But in my experience, their estimates were actually more accurate than what my accountant guessed. They specifically have expertise with these partnership forms that have weird timing issues with the IRS deadlines.

Wait, how does this actually work? They can get you through to the IRS faster? That seems too good to be true. The last time I called I was on hold for like 2 hours and then got disconnected.

This sounds like a scam. There's no way a third-party service can magically get you to the front of the IRS phone queue. And even if they could, why would you trust giving your info to some random service? The IRS is notoriously understaffed - no one gets "special access.

It's a callback service that uses their business line to get through the IRS phone system more efficiently. They don't actually talk to the IRS for you - they just get you a spot in line and call you when an agent is available so you don't have to wait on hold. They don't need any sensitive tax info - they just need your phone number to call you back. I was skeptical too until I tried it. I got a call back in about 40 minutes with an IRS agent on the line, after spending days trying to get through on my own. The agent walked me through exactly what to do with my missing K-3 situation.

That's a good idea! I just checked and they do have an investor portal, but unfortunately, it also says the K-3s aren't ready yet. The message says "K-3s will be available by June 15th" which is the same thing the phone rep told me. I did email my contact at the partnership to ask if they could provide draft numbers, but haven't heard back yet. Do you think it would be bad to file an extension, then amend later if the numbers change significantly?

Filing an extension and then potentially amending later is absolutely fine and very common, especially with these K-1/K-3 situations. Many partnerships and investment firms routinely issue K-1s close to or even after the filing deadline, and the IRS fully expects that investors will need to file extensions. If the numbers end up being close to what you estimated, you might not even need to amend. You only really need to consider amending if there's a significant difference that would affect your tax liability. The threshold for "significant" varies, but generally a few hundred dollars difference in foreign tax credits might not warrant an amendment unless you're trying to maximize every credit.

TurboTax does have a section for K-1s but honestly it's not great with these special situations. Last year when this happened to me, TurboTax kept flagging it as an error that I couldn't resolve without the missing info. I ended up having to file an extension anyway. H&R Block's software actually handled it better - they have a specific option for "K-3 not yet available" that lets you proceed with filing while flagging which items might need to be amended later. Might be worth switching if you're not too far along in TurboTax.

Thanks for the tip about H&R Block! I haven't gotten too far in TurboTax yet so switching wouldn't be a big deal. I'm just so annoyed that these partnerships can just decide not to provide necessary tax forms until after the filing deadline and somehow that's completely legal. Seems like the IRS should hold THEM accountable rather than making all of us jump through hoops.