New (tax) year, new help!

Fixed Assets and UltraTax CS 2023 help is now on Help and Support. We're still moving articles, but you can find most content for the 2023 tax year there. Continue using the Help & How-To Center for tax years 2022 and older.

New Jersey law requires that pass-through entities supply a New Jersey Schedule K-1 showing the income calculated under New Jersey law, that is then reported on the individual's New Jersey return.

In scenarios where the pass-through entity did not 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 the application'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 was prepared in the application, the New Jersey information will data share into the individual New Jersey return. See 1040-NJ: Data sharing Schedule K-1 information for more details.

If the New Jersey Schedule K-1 was not prepared in the application, enter the data as follows:

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 Screen K1-2 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 federal Screen K1-St in the Ordinary income everywhere (New Jersey) field.
• On federal Screen K1-2, 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.

Examples of New Jersey Schedule K-1s

Taxpayer does not have NJ Schedule K-1

If the taxpayer does not have a New Jersey Schedule K-1 (examples shown above), you must 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 assist in calculating 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 federal input screens for K1.

Amounts entered in the federal columns of federal Screens K1 through K1-7 will transfer to Screen NJK1Wrk, in the New Jersey K1 1065, 1120S folder. Additional data entry is required on this input screen for an accurate calculation since some adjustments are not 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.

Part-year residents: The application will automatically prorate the federal K-1 amounts that transfer to New Jersey when part-year residency dates are entered in Screen NJNRPY, in the Income & Adjustments folder.

If the taxpayer does not have a New Jersey Schedule K-1 and you do not 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 Screen NJK1 and follow the data entry steps above as if the taxpayer had received a New Jersey K-1, using the net taxable amount instead. 

Was this article helpful?

Yes No

Submit