S Corp. has K1 from Partnership

[jeff501]

I am working on an S Corporation return and the Corporation has a K1 from a partnership. The Corporation incurred losses from the K1 and I am not sure how to report this on the 1120S. Never had this type of situation before.

I don't think I want to just include the ordinary loss with other income/loss from the S Corp. but rather report the K1 items line by line like on a Schedule E on a 1040?

I use Tax Slayer and cannot figure out how to report this within the program. The K1 is from an oil drilling company and they had intangible drilling losses in 2007 of $23,000 and ordinary business loss of $305.

In the past on an individual's return I have taken these drilling costs as a 5 year write off on form 4562 on the schedule E but not sure how to treat this on an 1120S.

Any insight would be greatly appreciated! I've used this board a few times in the past and always found it a valuable resource.

Counting the days, 14 to go!

[Bees Knees]

It depends.

The Form 1120S instructions are loaded with instructions on where to report K-1 income from a partnership.

For example, Line 10 of the 1120S instructions say to report the ordinary income from the partnership K-1 on this line, and any ordinary loss from the K-1 on line 26 of the 1120S.

Any pass through items from the 1065 K-1 would also go on the equivalent line of the 1120S Schedule K, and so on.