K-1 Form

A K-1 form is a document used by certain entities, like partnerships, S-corporations, or trusts, to report each owner's or partner's share of income, deductions, and credits for a specific tax year. If you are a partner or shareholder, the K-1 tells you how much profit or loss you earned through the business or trust, so you can include this information on your personal tax return. Essentially, it ensures that the income is taxed appropriately based on your ownership stake, even if you haven't received all the money directly.