Part III of Schedule K-2 (and Part III of Schedule K-3).

Part III is used to report information necessary for the partner to determine the allocation and apportionment of research and experimental (R&E) expenses, interest expense, and the FDII deduction for purposes of the foreign tax credit limitation. Part III is also used to report foreign taxes paid or accrued by the partnership and the partner’s distributive share of such taxes. Additionally, it’s used to report income adjustments under section 743(b) by source and separate category. Partners will use the information to figure and claim a foreign tax credit on Form 1116 or 1118.