Schedule KS — Shareholder's Share of Income, Credits and Modifications (2025)

2025 KS, Shareholder's Share of Income,
Credits and Modifications

257411
S corporation: Complete and provide Schedule KS to each nonresident shareholder and Minnesota shareholder who has adjustments to income or credits, or all shareholders if the S corporation is electing PTE tax.
/ / Amended KS: Tax year beginning (MM/DD/YYYY) / / and ending (MM/DD/YYYY) Shareholder's Federal ID or Social Security Number S Corporation's Federal ID Number S Corporation's Minnesota Tax ID Shareholder's Name S Corporation's Name Mailing Address Mailing Address City State ZIP Code City State ZIP Code Entity of Shareholder Estate Shareholder's percentage of Individual (place an X in one box): Exempt Organization stock ownership for tax year: Trust Calculate lines 1-38 the same for all resident and nonresident shareholders. Calculate lines 39-53 for all nonresident shareholder's, and resident shareholders if the s-corporation elected PTE tax. Round amounts to the nearest whole dollar. Form M1 filers, include on:
Modifications to Federal Taxable Income
1 Interest income from non-Minnesota state and municipal bonds 1 M1M, line 1 2 State taxes deducted in arriving at s corporation's net income 2 M1MB, line 2 3 Expenses deducted that are attributable to income not taxed by Minnesota (other than interest or mutual fund dividends from U.S. bonds) 3 M1M, line 3 4 100% of shareholder's pro rata share of federal bonus depreciation 4 M1MB, see line 1 inst.
5 Foreign-derived intangible income (FDII) deduction 5 M1MB, line 3 6 Addition due to federal changes not adopted by Minnesota (Schedule KSNC, line 31) 6 7a Shareholder's pro rata gross profit from installment sales of pass-through businesses (see instructions). 7a M1AR, line 1 7b Shareholder's pro rata installment sale income from pass-through businesses (see instructions) 7b M1AR, line 3 8 This line intentionally left blank 8 9 This line intentionally left blank 9 10 This line intentionally left blank 10 11 This line intentionally left blank 11 12 This line intentionally left blank 12 13 Employee Retention Credit subtraction 13 M1MB, line 21 14 Interest from U.S. government bond obligations, minus any expenses deducted on the federal return that are attributable to this income 14 M1M, line 14 9995 Continued next page

2025 KS, page 2
257421
Shareholder's Name Shareholder's Federal ID or Social Security Number S Corporation's Name S Corporation's Federal ID Number S Corporation's Minnesota ID Number 15 Deferred foreign income (section 965) 15 M1MB, line 17 16 Disallowed section 280E expenses of a licensed cannabis or hemp business 16 M1MB, line 16 17 Delayed business interest 17 see schedule KS inst.
18 State income tax refund included in income (see instructions) 18 M1, line 6 19 Subtraction due to federal changes not adopted by Minnesota (Schedule KSNC, line 31, as a positive number) 19 20 This line intentionally left blank 20 21 Shareholder's pro rata share of a net gain relating to dispositions of Class 2a property 21 Schedule NIIT, line 2 22 Shareholder's pro rata share of deductions and modifications relating to line 21 22 Schedule NIIT, line 7 23 State Housing Tax Credit 23 M1C, line 15 Enter the credit certificate number from Minnesota Housing: SHTC -24 Short Line Railroad Infrastructure Modernization Credit 24 Enter certificate number from the certificate you received from the Minnesota Department of Transportation: MN-SLR -M1C, line 14 25 Credit for Sales of Manufactured Home Parks to Cooperatives 25 M1C, line 13 26 Credit for increasing research activities 26 M1C, see line 16 inst.
27 Film Production Tax Credit 27 M1C, line 11
Enter the credit certificate number: TAXC -
28 Tax Credit for Owners of Agricultural Assets 28
Enter the certificate number from the certificate received from the Rural Finance Authority:
M1C, line 12
AO
29 Credit for Sustainable Aviation Fuel 29 M1REF, line 12 Enter certificate number from the Department of Agriculture:
30 Credit for historic structure rehabilitation 30 M1REF, line 7 Enter National Park Service (NPS) number:
9995 Continued next page

2025 KS, page 3
257431
Shareholder's Name Shareholder's Federal ID or Social Security Number S Corporation's Name S Corporation's Federal ID Number S Corporation's Minnesota ID Number 31 Employer Transit Pass Credit 31 M1C, line 5 32 Enterprise Zone Credit ...
34 Minnesot a backup withholding 34
35 Intangible drilling costs 35
36 Gross income from oil, gas and geothermal properties 36 37 Deductions allocable to oil, gas and geothermal properties 37 38 Depletion 38
Minnesota Portion of Amounts From Federal Schedule K-1 (1120S)
39 Minnesota source gross income 39
40 Ordinary Minnesota source income (loss) from trade or business activities 40 41 Income (loss) from Minnesota rental real estate and other Minnesota rental activities 41 42 Interest income 42 43 Ordinary dividends 43 44 Royalties 44 45 Net Minnesota short-term capital gain (loss) ...
46 Ne t Minnesota long-term capital gain (loss) 46
47 Section 1231 Minnesota net gain (loss) 47
48 Other Minnesota income (loss). (Describe type of income or include separate sheet: ) 48 49 Section 179 expense deduction apportionable to Minnesota 49 50 S c orporation's Minnesota apportionment factor (line 5, column C of M8A) 50
Composite Income Tax or Nonresident Withholding
51 Minnesota source distributive income (see instructions) 51 S c orporations: Include this schedule and copies of federal Schedules K and K-1 when you file your Form M8.
M1REF, line 8
33 Pass-Through Entity Tax Credit. If the pass-through entity tax satisfies the shareholder's filing requirement, check this box see instructions M1W, line 3, col C
Relating to Alternative Minimum Tax
Lines 35-38 are used to compute M1MT, lines
6 and 7. See M1MT instructions for details. info only (see inst.) M1NR, line 6, col B M1NR, line 6, col B M1NR, line 2, col B M1NR, line 2, col B M1NR, line 6, col B M1NR, line 4, col B M1NR, line 4, col B M1NR, line 4 or 8, col B M1NR, line 8, col B M1NR inst., line 6, col B information only see schedule KS inst.
52 Minnesota composite income tax paid by S corporation. If the shareholder elected composite income tax, mark an X in this box: composite income tax 53 Minnesota income tax withheld for nonresident shareholder not electing to file composite income tax. If the shareholder completed and signed a Form AWC, mark an X in this box: M1W, line 3, col C
Shareholders: Include this schedule when you file your Minnesota Form M1.

2025 Schedule KS Instructions
Shareholder's use of information provided on Schedule KS
Purpose of Schedule KS
Schedule KS is a supplemental schedule provided by the S corporation to its shareholders. The shareholders need this information to complete:

• Form M1, Minnesota Individual Income Tax Return
• Form M2, Minnesota Income Tax Return for Estates and Trusts
• Form M2SB, Minnesota Income Tax Computation for S Portion of ESBT An individual shareholder who is a Minnesota resident will be taxed by Minnesota on all of his or her distributive income from the S corporation even if the income is apportioned between Minnesota and other states. An estate, trust, and individual nonresident shareholder will be taxed on the Minnesota distributive income from the S corporation.

These instructions are intended to help you report your share of the S corporation's income, credits and modifications on your Minnesota return.
You must include Schedule KS when you file your Form M1 and Form M2. If you do not include the schedule with your return as required, the department will disallow any credits and assess the tax or reduce your refund.
If you received an amended Schedule KS from the S corporation and your income or deductions have changed, you must file an amended Minnesota return. To amend your return, use Form M1X, Amended Minnesota Income Tax Return or Form M2X, Amended Income Tax
Return for Estates and Trusts.

# Line Instructions

Include amounts on the appropriate lines as shown on Schedule KS.
Line 1 - Non-Minnesota State and Municipal Bond Interest Individuals: Include on line 1 of Schedule M1M.
Estates and Trusts: Include on line 44 of Form M2.
Electing Small Business Trusts: Include on line 12 of Form M2SB Line 2 - State Taxes Deducted Individuals: Include on line 2 of Schedule M1MB.
Estates and Trusts: Include on line 45 of Form M2.
Electing Small Business Trusts: Include on line 13 of Form M2SB.
Line 3 - Expenses Deducted Attributed to Income Not Taxed by Minnesota Individuals: Include On line 3 of Schedule M1M.
Estates and Trusts: Include on line 46 of Form M2.
Electing Small Business Trusts: Include on line 14 of Form M2SB.
Line 4 - Federal Bonus Depreciation
Individuals: See Schedule M1MB line 1 instructions, to determine how to report this amount.
Estates and Trusts: Include this amount within the worksheet to determine Line 48 of the Form M2.
Electing Small Business Trusts: Include on line 16 of Form M2SB.
Line 5 - Foreign Derived Intangible Income (FDII) Deduction Individuals: Include on line 3 of Schedule M1MB.
Estates and Trusts: Include on line 52 of Form M2.
Electing Small Business Trusts: Include on line 20 of Form M2SB.
Line 6 - Addition Due to Federal Changes Not Adopted by Minnesota Individuals: This line does not apply.
Estates and Trusts: This line does not apply.
Lines 7a, and 7b - Accelerated Installment Sale Gains
Nonresident Individuals: If any information is reported to you on line 7a of Schedule KS, file Form M1AR, Accelerated Recognition of Installment Sale Gains, with your Minnesota individual income tax return.
Resident Individuals: If any information is reported to you on line 7 of Schedule KS, retain a copy of this schedule for your records for the entire period that you or an entity, you have an interest in, is receiving installment sale payments. If you become a nonresident in a future year while payments are being made, you are required to file Form M1AR, Accelerated Recognition of Installment Sale Gains, with your final Continuedresident tax return.

2025 Schedule KS Instructions (Continued)
Estates and Trusts: Pass through pro rata to your beneficiaries.
Lines 8 through 12
These lines are intentionally left blank.
Line 13 - Employee Retention Credit Subtraction
Individuals: Include on line 21 of Schedule M1MB.
Estates and Trusts: Include on line 69 of Form M2.
Electing Small Business Trusts: Include on line 38 of Form M2SB.
Line 14 - Interest on U.S. Government Bond Obligations Individuals: Include on line 14 of Schedule M1M.
Estates and Trusts: Include on line 59 of Form M2.
Electing Small Business Trusts: Include on line 28 of Form M2SB.
Line 15 - Deferred Foreign Income (Section 965)
Individuals: Include on line 17 of Schedule M1MB.
Estates and Trusts: Include on line 65 of Form M2.
Electing Small Business Trusts: Include on line 34 of Form M2SB.
Line 16 - Disallowed Section 280E Expenses of a Licensed Cannabis or Hemp Business Individuals: Include on line 16 of Schedule M1MB.
Estates and Trusts: Include on line 66 of Form M2.
Electing Small Business Trusts: Include on line 35 of Form M2SB.
Line 17 - Delayed Business Interest
Individuals: This line does not apply.
Estates and Trusts: This line does not apply.
Line 18 - State income tax refund included in income
Individuals: Include on line 6 of Form M1.
Estates and Trusts: Include on line 60 of Form M2.
Electing Small Business Trusts: Include on line 29 of Form M2SB.
Line 19 - Subtraction Due to Federal Changes Not Adopted by Minnesota Individuals: This line does not apply.
Estates and Trusts: This line does not apply.
Line 20
This line is intentionally left blank.
Lines 21 and 22 - Adjustments to Net Investment Income Individuals, estates and trusts with investment income in excess of $1 million may need to pay a Minnesota net investment income tax. The net gain on the sale of Class 2a property and related expenses are excluded from the calculation of Minnesota net investment income subject to the Minnesota net investment income tax. Use Schedule NIIT, Net Investment Income Tax, to determine if you are required to pay the tax on your Form M1 or Form M2 return.
Line 23 - State Housing Tax Credit
Individuals: Include on line 15 of Schedule M1C and enter the certificate number in the space provided. To claim this credit, you must include this schedule with Form M1.
Estates and Trusts: Include on line 19 of Form M2 and enter the certificate number in the space provided. To claim this credit, you must include this schedule with Form M2.
Line 24 - Short Line Railroad Infrastructure Modernization Credit Individuals: Include on line 14 of Schedule M1C and enter the certificate number in the space provided. To claim this credit, you must include this schedule with Form M1.
Estates and Trusts: Include on line 20 of Form M2 and enter the certificate number in the space provided. To claim this credit, you must include this schedule with Form M2. Continued

2025 Schedule KS Instructions (Continued)
Line 25 - Credit for Sales of Manufactured Home Parks to Cooperatives Individuals: Include on line 13 of Schedule M1C. To claim this credit, you must include this schedule with Form M1.
Estates and Trusts: Include on line 21 of Form M2. To claim this credit, you must include this schedule with Form M2.
Line 26 - Credit for Increasing Research Activities
Individuals: See Schedule M1C, worksheet for line 16 instructions, to determine how to report this amount. To claim this credit, you must include this schedule with Form M1.
Estates and Trusts: See the Form M2 instructions for line 22 to determine how to report this amount. To claim this credit, you must include this schedule with Form M2.
Line 27 - Film Production Tax Credit
Individuals: Include on line 11 of Schedule M1C and enter the certificate number in the space provided. To claim this credit, you must include this schedule with Form M1.
Estates and Trusts: Include on line 17 of Form M2 and enter the certificate number in the space provided. To claim this credit, you must include this schedule with Form M2.
Line 28 - Tax Credit for Owners of Agricultural Assets Individuals: Include on line 12 of Schedule M1C and enter the certificate number in the space provided. To claim this credit, you must include this schedule with Form M1.
Estates and Trusts: Include on line 18 of Form M2 and enter the certificate number in the space provided. To claim this credit, you must include this schedule with Form M2.
Line 29 - Credit for Sustainable Aviation Fuel
Individuals: Include on line 12 of Schedule M1REF and enter the certificate number in the space provided. To claim this credit, you must include this schedule with Form M1.
Estates and Trusts: Include on line 31 of Schedule M2 and enter the certificate number in the space provided. To claim this credit, you must include this schedule with Form M2.
Line 30 - Credit for Historic Structure Rehabilitation Individuals: Include on line 7 of Schedule M1REF and enter the NPS project number in the space provided. To claim this credit, you must include this schedule with Form M1.
Estates and Trusts: Include on line 30 of Form M2 and enter the NPS project number in the space provided. To claim this credit, you must include this schedule with Form M2.
Line 31 - Employer Transit Pass Credit
Of the credit amount from Schedule ETP, any amount not claimed on line 7 of Form M8 may be passed through to shareholders based on their distributive share.
Individuals: Include on line 5 of Schedule M1C. To claim this credit, you must include this schedule with Form M1.
Estates and Trusts: Include on line 23 of Form M2. To claim this credit, you must include this schedule with Form M2.
Line 32 - Enterprise Zone Credit
Individuals: Include on line 8 of Schedule M1REF. To claim this credit, you must include this schedule with Form M1.
Estates and Trusts: Include on line 33 of Form M2. To claim this credit, you must include this schedule with Form M2.
Line 33 - Pass-Through Entity Tax Credit
Individuals: Include on line 10 of Schedule M1REF. To claim this credit, you must include this schedule with Form M1.
Estates and Trusts: Include on line 27 of Form M2. To claim this credit, you must include this schedule with Form M2.
Continued

2025 Schedule KS Instructions (Continued)
Nonresidents: If your only Minnesota source income is from entities making a PTE tax election, or entities in which you elected composite income tax, you do not need to file Form M1.
Line 34 - Minnesota Backup Withholding
Individuals: Include on line 3, column D of Schedule M1W. To claim this credit, you must include this schedule with Form M1.
Estates and Trusts: Pass through pro rata to your beneficiaries. You must include this schedule with Form M2.
Lines 35 - 38 Items Relating to Alternative Minimum Tax Individuals: Use the information on lines 35 through 38 to complete Schedule M1MT.
Estates and Trusts: Use the information on lines 35 through 38 to complete Schedule M2MT.
Electing Small Business Trusts: Use the information on lines 35 through 38 to complete Schedule M2MT.
Lines 39 - 50 Minnesota Portion of Federal Amounts
Lines 39-50 apply to estate, trust, and nonresident individual shareholders.
If certain items are not entirely included in your federal income because of passive activity loss limitation, capital loss limitations, section 179 limitations or for other reasons, include only the amounts that you included in your federal adjusted gross income.
Individuals: Use the information on lines 39 through 50 to complete Schedule M1NR.
Minnesota source gross income is used to determine if a nonresident is required to file a Minnesota individual income tax return. Gross income is income before business or rental deductions and does not include losses.
If your 2025 Minnesota source gross income is $14,950 or more and you did not elect composite tax filing or elected to have the PTE tax filing to fulfill your filing requirement, you are required to file Form M1 and Schedule M1NR, Nonresident/Part-Year Residents.
If your 2025 Minnesota source gross income is less than $14,950 and you had Minnesota tax withheld (see line 34 and line 53 of Schedule KS), file Form M1 to receive a refund.
Estates and Trusts: Use the information on lines 39 through 50 to complete Schedule M2NM.
Line 43 - Ordinary Dividends
Individuals: If you are a nonresident or part-year resident, include the amount on line 2, column B of Schedule M1NR.
Estates and Trusts: Use this information to complete Schedule M2NM.
Line 51 - Minnesota Source Distributive Income
Although Minnesota source gross income (line 39 of Schedule KS) determines whether you must file a Minnesota return, your Minnesota source distributive income is ultimately taxed.
Line 52 - Minnesota Composite Income Tax
Individuals: If you elected composite income tax filing, the amount paid on your behalf equals 9.85% of your Minnesota source distributive income on line 51, minus your share of any credits on lines 23-25, 27-32, and 34. You are not required to file Form M1.
Estates and Trusts: This line does not apply.
Line 53 - Minnesota Nonresident Withholding
Individuals: Include the amount from line 53 on Schedule M1W, line 3, column D. Also include the amount from line 51 on Schedule M1W, line 3, column C.
Estates and Trusts: This line does not apply.