Page 319 - BusinessStructures & Forms

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The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.
section 170(f)(9) for more details. Also, see Contributions You Can’t If a partner makes the election, these items aren't treated as
Deduct in Pub. 526 for more examples of nondeductible alternative minimum tax (AMT) tax preference items. Because the
contributions. partners are generally allowed to make this election, the partnership
Contributions (100%) (code G). Use code G to report the cannot deduct these amounts or include them as AMT items on
Schedule K-1. Instead, the partnership passes through the
contributions below and, on an attached statement, provide the information the partners need to figure their separate deductions. On
following information. line 13c(1), enter the type of expenditures claimed on line 13c(2).
Qualified conservation contributions of property used in Enter on line 13c(2) the qualified expenditures paid or incurred
agriculture or livestock production. Enter qualified conservation during the tax year for which an election under section 59(e) may
contributions of property used in agriculture or livestock production. apply. Enter this amount for all partners whether or not any partner
The contribution must be subject to a restriction that the property makes an election under section 59(e).
remain available for such production. See section 170(b)(1)(E)(iv)
for details. On an attached statement, identify the property for which the
If the partnership is a qualified farmer or rancher (as defined in expenditures were paid or incurred. If the expenditures were for
section 170(b)(1)(E)(v)), show each partner's distributive share of intangible drilling costs or development costs for oil and gas
qualified conservation contributions of property used in agriculture or properties, identify the month(s) in which the expenditures were paid
livestock production. Partners will have to separately determine or incurred. If there is more than one type of expenditure or more
whether they qualify for the 50% or 100% AGI limitation for these than one property, provide the amounts (and the months paid or
contributions. Do not include the amounts reported on the attached incurred if required) for each type of expenditure separately for each
statement using code G in the amount reported on Schedule K-1 for property.
qualified conservation contributions using code C.
Schedule K-1. Report each partner's distributive share of Schedule K-1. Report each partner's distributive share of section
59(e) expenditures in box 13 of Schedule K-1 using code J. Identify
charitable contributions in box 13 of Schedule K-1 using codes A the following on an attached statement: (a) the type of expenditure;
through F for each of the contribution categories shown above. For (b) the property for which the expenditures are paid or incurred; and
code G items, report them by entering code G with an asterisk (G*) (c) for oil and gas properties only, the month in which intangible
and entering "STMT" in the dollar amount entry space for box 13 and drilling costs and development costs were paid or incurred. If there
attach a statement that shows "Box 13, Code G" and the dollar is more than one type of expenditure or the expenditures are for
amount of each type of deduction. The partnership must attach a more than one property, provide each partner's distributive share of
copy of its Form 8283 to the Schedule K-1 of each partner receiving the amounts (and the months paid or incurred for oil and gas
a distributive share of the contribution deduction shown in Section A properties) for each type of expenditure separately for each
or Section B of its Form 8283. property.

Line 13b. Investment Interest Expense (Code H) Line 13d. Other Deductions

Include on this line the interest properly allocable to debt on property Enter deductions not included on lines 12, 13a, 13b, 13c(2), and 21.
held for investment purposes. Property held for investment includes On the line to the left of the entry space for this line, identify the type
property that produces income (unless derived in the ordinary of deduction. If there is more than one type of deduction, attach a
course of a trade or business) from interest, dividends, annuities, or statement to Form 1065 that separately identifies the type and
royalties; and gains from the disposition of property that produces amount of each deduction for the following categories. The codes
those types of income or is held for investment. needed for Schedule K-1 reporting are provided for each category.

Investment interest expense doesn't include interest expense Deductions—royalty income (code I). Enter deductions related
allocable to a passive activity. to royalty income.
Schedule K-1. Report each partner’s distributive share of
deductions related to royalty income.
Investment income and investment expenses other than interest
are reported on lines 20a and 20b, respectively. This information is Excess business interest expense (code K). If the partnership
needed by partners to determine the investment interest expense is required to file Form 8990, it may determine it has excess
limitation (see Form 4952 for details). business interest expense. If so, enter the amount from Form 8990,
Schedule K-1. Report each partner's distributive share of Part II, line 32, for excess business interest expense.
Schedule K-1. Provide the information the partners need to
investment interest expense in box 13 of Schedule K-1 using code figure excess business interest expense. In box 13, report the
H. partner’s distributive share of excess business interest expense. If
Lines 13c(1) and 13c(2). Section 59(e)(2) the partnership reports excess business interest expense, the
partner is required to file Form 8990. The partner will enter the
Expenditures (Code J) amount on Form 8990, Schedule A, line 43(c). See the Instructions
for Form 8990 for additional information.
Generally, section 59(e) allows each partner to make an election to Deductions—portfolio income (other) (code L). Enter any other
deduct their distributive share of the partnership's otherwise deductions related to portfolio income.
deductible qualified expenditures ratably over 10 years (3 years for No deduction is allowed under section 212 for expenses
circulation expenditures). The deduction is taken beginning with the allocable to a convention, seminar, or similar meeting. Because
tax year in which the expenditures were made (or for intangible these expenses aren't deductible by partners, the partnership
drilling and development costs, over the 60-month period beginning doesn't report these expenses on line 13d of Schedule K. The
with the month in which such costs were paid or incurred). expenses are nondeductible and are reported as such on line 18c of
Schedule K and in box 18 of Schedule K-1 using code C.
The term “qualified expenditures” includes only the following Schedule K-1. In box 13, report the partner's distributive share
types of expenditures paid or incurred during the tax year. of deductions related to portfolio income that are reported on
• Circulation expenditures. line 13d of Schedule K using code I (for deductions related to royalty
• Research and experimental expenditures. income) or L (for other deductions related to portfolio income).
• Intangible drilling and development costs.
• Mining exploration and development costs. Amounts paid for medical insurance (code M). Enter amounts
paid during the tax year for insurance that constitutes medical care

-40- Instructions for Form 1065 (2022)