Use case · Tax season
Get your fund’s Schedule K-1s out on time, with data your tax preparer can rely on
K-1 season is decided in January, not March. We prepare the capital accounts, allocations and supporting data your CPA needs to file on time.
In one minute
Schedule K-1 (Form 1065) is the statement a US partnership, such as a Delaware LP fund, issues to each partner showing their share of income, gains, losses, deductions and credits for the tax year. Fundtec prepares the underlying data, including partner capital accounts, allocations and tax basis capital, for the fund’s CPA or tax preparer, who prepares, signs and files the return.
Managers at a decision point: a fund to launch, an administrator to change, or an operating model that has to scale.
A 30-minute scoping call, then a written plan: scope, the transition timeline and indicative pricing. No generic proposal.
What a Schedule K-1 is and why funds issue them
A partnership does not pay US federal income tax itself. Its income, gains, losses and deductions pass through to its partners, who report them on their own returns. The partnership files Form 1065 and gives each partner a Schedule K-1 showing that partner’s share. Hedge funds, private equity, venture and credit funds organized as limited partnerships, including Delaware LPs and US feeder funds in a master-feeder, issue K-1s every year.
The K-1 is only as good as the books behind it. Allocations depend on accurate capital accounts, investor-level P&L, fee and incentive allocations, and complete records of contributions, withdrawals and transfers. That data comes from the fund’s administrator, which is where Fundtec fits. See our Delaware jurisdiction page for how US partnerships are structured.
Data preparation, not tax advice
Fundtec prepares and reconciles the data that goes into K-1s. The fund’s tax adviser or CPA determines tax treatment, prepares and signs Form 1065 and the K-1s, and advises on elections. Fundtec does not provide tax advice.
K-1 data Fundtec prepares for your tax preparer
- 01
Partner capital accounts
Opening balance, contributions, withdrawals, allocated income and loss and closing balance for each partner, reconciled to fund net assets.
- 02
Book allocations
Allocation of realized and unrealized gains and losses, income, expenses, management fees and incentive allocations by partner and period.
- 03
Tax allocation inputs
Realized gain and loss detail by holding period, tax lots and the data needed for the aggregate or layered allocation method chosen by the tax adviser.
- 04
Tax basis capital support
Inputs for the tax basis capital accounts that partnerships must report on each K-1.
- 05
K-2 and K-3 data
Foreign-source income, foreign taxes paid and other items of international tax relevance, for partnerships required to file Schedules K-2 and K-3.
- 06
Investor data
Partner names, addresses, tax identifiers, entity type and US or foreign status from the investor register, plus transfers during the year.
K-1 timeline for a calendar-year fund
Indicative timing. Your tax preparer sets the final schedule, and funds that invest in other partnerships depend on receiving those K-1s first.
| Stage | Typical timing | Who leads |
|---|---|---|
| Year-end close and final NAV | January | Fundtec as administrator |
| Partner allocations and capital accounts finalized | Late January to February | Fundtec, reviewed by the manager |
| Tax data package delivered to the CPA | February | Fundtec |
| Draft K-1s and Form 1065 prepared | February to early March | Fund’s CPA or tax preparer |
| Review of drafts against the books | Early March | Manager, CPA and Fundtec |
| Form 1065 filed and K-1s issued | By March 15 | CPA files; K-1s distributed through the investor portal |
| Extended deadline if Form 7004 is filed | By September 15 | CPA; estimates often sent to investors in the interim |
Common K-1 issues and how to avoid them
- 01
Late audit or late year-end close
K-1s cannot be finalized until the books are. A clean January close keeps the whole timeline on track.
- 02
Mid-year transfers and redemptions
Partial-year partners need correct allocation periods. Transfers must be recorded with effective dates in the register.
- 03
Waiting on underlying K-1s
Funds of funds and feeders depend on K-1s from the partnerships they invest in; the master fund’s timing drives the feeder’s.
- 04
Capital account mismatches
K-1 capital must tie to investor statements. Differences surface as investor queries after distribution.
- 05
Missing investor tax information
Incomplete W-9 or W-8 forms delay K-1s and withholding analysis for foreign partners.
- 06
Amended K-1s
Corrections after issue frustrate investors who have already filed. A review stage against the books before release prevents most of them.
What your tax preparer needs from the administrator
- Final audited or audit-ready trial balance for the year
- Partner capital account roll-forward by investor
- Allocation detail by partner and allocation period
- Realized gain and loss report with holding periods
- Income detail: interest, dividends, and foreign-source items
- Expense detail including management fees and organizational costs
- Investor register with tax identifiers and US or foreign status
- Schedule of contributions, withdrawals and transfers with effective dates
- K-1s received from underlying partnership investments
Engagement model
How an engagement is structured
Economics aligned to your growth. Scope, cadence and pricing are confirmed jointly in the first phase.
- 01 · Weeks 1–4
Onboarding & design
A phase-linked fee covers process mapping, the operational handbook, systems access and the SLA framework — before any handover.
- Target operating model
- Operational handbook
- SLAs agreed jointly
- 02 · From the parallel run
Monthly base fee
Your dedicated team, pod manager oversight and the governance cadence — daily huddle, weekly review, monthly service review, QBR.
- Named PM → SME
- Trained backup for every role
- Governance included
- 03 · As you grow
Scales with AUM
AUM-linked tiers and pre-agreed triggers for new mandates or counterparties — so growth never means renegotiating the contract.
- Transparent triggers
- No renegotiation
- Quarterly pricing review
Every engagement starts with a scoping call — no obligation, no generic proposal.
Request an indicative proposalQuestions
Common questions about File Your K-1s
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Ask a specialistFrequently asked questions
When are Schedule K-1s due for a fund partnership?
For a calendar-year partnership, Form 1065 and the related Schedule K-1s are due by March 15, the 15th day of the third month after year-end. Filing Form 7004 extends the deadline by six months to September 15. Many funds extend and send estimates to investors in the meantime. Your tax preparer confirms the dates that apply to your fund.
Does Fundtec prepare and file K-1s?
Fundtec prepares the data behind the K-1s: partner capital accounts, allocations, realized gain and loss detail, tax basis capital inputs and investor information. The fund’s CPA or tax preparer prepares, signs and files Form 1065 and the K-1s. Fundtec does not provide tax advice and does not sign returns.
What are Schedules K-2 and K-3?
Schedules K-2 and K-3 report items of international tax relevance, such as foreign-source income and foreign taxes paid, so partners can complete their own US international tax reporting. Partnerships with such items, or with partners who need the information, generally must provide them. Fundtec prepares the supporting data; your tax adviser decides whether and how they apply.
Why are my fund’s K-1s always late?
K-1s are usually late because something upstream is late: the year-end close, the audit, underlying K-1s from other partnerships, or investor tax information. A timely January close, a complete investor register and early delivery of the tax data package to the CPA remove most delays. Funds of funds may still need to extend.
Do offshore feeder funds issue K-1s?
Offshore feeders organized as corporations for US tax purposes generally do not issue K-1s to their investors. A US feeder fund organized as a partnership does, and it receives a K-1 from the master fund if the master is also a partnership. Structure-specific questions should go to the fund’s tax adviser.
What is tax basis capital on a K-1?
Tax basis capital is each partner’s capital account measured under tax rules rather than book or GAAP rules. Partnerships must report it on each Schedule K-1. It often differs from the capital shown on investor statements because of unrealized gains and other book-tax differences. Fundtec provides the capital and allocation inputs; the CPA computes the tax figures.
Can Fundtec help if we switch administrators before tax season?
Yes. Capital account history, allocations and investor data are migrated and tied out during an administrator transition, so the tax data package is complete for the full year. If the switch happens mid-year, we reconcile the periods covered by each administrator so the tax preparer receives one consistent set of allocations.
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Read more →Prepare for K-1 season now
Talk to us before year-end about your close timeline, allocation data and CPA hand-off, so your K-1s go out on time.