Schedule K-1 (Form 1065) - Loss Limitations

While the at-risk limitations is calculated on IRS Form 6198 At-Risk Limitations and the passive activity limitations is calculated on IRS Form 8582 Passive Activity Loss Limitations, there is not an IRS form for the potential limitations on the amount of partnership losses that you may deduct based on your basis in the partnership. You would need to enter only the loss allowed on Line 1 of IRS Schedule K-1 (Form 1065) Partner’s Share of Income, Deductions, Credits, etc. , and then manually track the basis and also the amount not allowed in the current year which could be carried forward to the time when the basis in the partnership allows the loss to be taken.

Additional Information

IRS Partner's Instructions for Schedule K-1 (Form 1065) Partner's Share of Income, Deductions, Credits, etc. (For Partner's Use Only, on page 2:

Limitations on Losses, Deductions, and Credits

There are potential limitations on partnership losses that you can deduct on your return. These limitations and the order in which you must apply them are as follows: the basis limitations, the at-risk limitations, and the passive activity limitations.

Each of these limitations is discussed separately in the instructions.

Note that any link in the information above is updated each year automatically and will take you to the most recent version of the webpage or document at the time it is accessed.