Input the 2019 SPE K-1 on your federal and Pa personal tax return
If you use a tax software make sure to create a federal K-1 form and input your federal donation deduction on your K-1 input screen. Make sure the K-1 in your tax software is in the same social security number as the K-1 you got in the mail. Your software typically lets you pick T for taxpayer or S for spouse on a joint personal tax return so make sure to select the correct T or S based on the social security number on the K-1 you got in the mail.
A TurboTax walkthrough video is provided with this post if you are doing your own tax return using TurboTax online. The key in the video is to create a federal K-1 and then update the Pa K-1 with your tax credit in the state interview process.
If you use a tax preparer make sure your Pa return has a Pa tax credit and requests a refund. The Pa tax credit can be tricky to enter into tax software even for a tax professional so before you sign and send your tax return for electronic filing make sure you asked on your Pa 40 line 23 other credits that your Pa tax credit for 2019 be used.
2019 SPE K-1 for Business
If you are one of the few donors who completed your joinder as a business make sure you complete Pa form 1123 to transfer the credit to your individual business owners or your personal refund will be delayed and you will receive a notice from Pa. A business that transfers the credit from the SPE to the business EIN and then to owners via K-1 must also complete the Pa form 1123 to actually transfer the Pa credit to individual owners personal social security numbers.
If you have electronically filed your Pa return and requested a refund Pa always hold refund requests until July and starts processing refunds in the new fiscal year beginning July 1. Here is a link to a monthly update about the process of getting to the front of the line in processing your Pa refund.
TurboTax online is an interview process for filing your personal return. Hopefully the video provided with this update will help you successfully include a federal K-1 and Pa K-1 with tax credit with your personal tax filing if TurboTax is the way you file your personal tax return.
Your PA K-1 will have a schedule attached if your credit is split between EITC and OSTC tax credits. On your PA tax return there are two catagories of tax credits. If you have a schedule that splits your EITC and OSTC tax credits then to be accurate you need to enter both catagories on your PA K-1. If you do this incorrectly the state should correct it automatically because we preload your tax credits up for the state by 1123 form transfer into the EITC and OSTC tax credit catagories of your personal return. A question came up from a donor about how to find the correct breakdown between EITC and OSTC and the correct breakdown is on a white paper schedule directly behind the PA K-1 in your packet.
Our SPE K-1's and 1123 filing process
The SPE K-1 you received has been electronically filed with the IRS and PA. The 1123 copy you have received is provided to a designated state employee who processes all of our 1123's at the same time to lower notices to donors and to make sure the 1123 is in the PA state system and the PA tax credit under the EIN of the SPE has been transferred to your personal social security number. Since we transfer the tax credit manually via the 1123 process the tax credit is already on your social security account with the state dated as a 1-1 payment for you for this tax year. The only thing you need to make sure and do is to claim the tax credit payment on your personal filing so you get a refund.