In alignment with IRS requirements, there are certain businesses that must file Schedule K-2 and Schedule K-3. Ultimately, any pass-through entities that have relevant international income, deductions, credits or other miscellaneous items must submit completed Schedule K-2 and Schedule K-3 forms.
What is Schedule K-2 and Schedule K-3?
Schedule K-2 is associated with Partner’s Distributive Share Items — International, while Schedule K-3 is categorized as Partner’s Share of Income, Deductions, Credits, Et Cetera — International. Any taxpayers who file Forms 1065, 1120-S or 8865 must also fill out the documents’ accompanying worksheets.