Expert preparation of pass-through entity returns and Schedule K-1 generation. We ensure compliance with reasonable compensation rules and maximize your deductible losses.
Pass-Through Taxation is a structure where a business pays no corporate income tax itself; instead, all profits and losses "pass through" directly to the owners' personal tax returns. To facilitate this, S-Corporations must file Form 1120-S and Partnerships (including Multi-Member LLCs) must file Form 1065 to report financial activity and issue Schedule K-1s to each owner. These informational returns are generally due by March 15th, ensuring owners receive their K-1s in time to file their personal taxes by April.
We prepare accurate 1120-S returns that stand up to IRS scrutiny. Our service includes calculating Shareholder Stock Basis (essential for deducting losses) and advising on Reasonable Compensation requirements to ensure you are paying enough payroll tax to satisfy the IRS, but not a penny more than necessary.
Whether you are a General Partnership or a Multi-Member LLC, we handle the complex allocation of profits. We track Partner Capital Accounts year-over-year and ensure Guaranteed Payments are reported correctly, preventing disputes between partners at tax time.
The output of your business return is the Schedule K-1. We generate these forms for every shareholder or partner, ensuring they match your personal tax return (Form 1040) perfectly. We deliver these early so you aren't waiting to file your personal taxes.
If you have employees, inventory, or significant sales in other states, you may have "Nexus" there. We perform State Apportionment calculations to determine how much of your income is taxable in each state, filing the necessary non-resident returns to keep you compliant nationwide.
Business taxes are not DIY projects. A simple mistake on an S-Corp return can trigger significant financial setbacks.
Without expert oversight, you face risks such as $220/month per shareholder penalties for late filing, disallowed losses due to incorrect basis tracking, or inadvertent double taxation. At JK Tax Service, we replace the uncertainty of DIY filing with strategic compliance, ensuring your business avoids these pitfalls while positioning you to retain the maximum amount of wealth.
Get StartedThe IRS requires S-Corps (1120-S) and Partnerships (1065) to file by March 15th—one month before personal taxes are due. This gives you time to receive your Schedule K-1 and include those numbers on your personal April 15th return.
If you own an S-Corp and work in the business, the IRS requires you to pay yourself a "reasonable salary" (W-2 wages) before taking profit distributions. If you take only distributions to avoid payroll taxes, you risk an audit and hefty penalties. We help you determine the "sweet spot" salary for your industry.
The penalty for late S-Corp or Partnership returns is severe: $220 for each month the return is late, multiplied by the number of shareholders/partners. Even if the business owes no tax, you still owe this penalty for late filing.
Yes, but it works differently than for a sole proprietor. Instead of a simple deduction, S-Corps typically use an "Accountable Plan" to reimburse the owner for home office expenses tax-free. We can help you set this up properly to ensure the deduction is valid.