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Income from S Corporations and Partnerships is not broken out to any other line by income type, except for the NJ tax-exempt income. The tax-exempt income is reported on lines 6 and 7 on NJ-1041 and lines 9 and 10 on NJ-1041SB. Otherwise, all S Corporation and Partnership income is categorized as such. 

S Corporation income allocation

S Corporations do not allocate per line item on the reconciliation worksheet; instead, an allocation percent must be entered on federal Screen K1. The taxable amount is determined by taking all the modifications, then applying the allocation percent, and finally applying a special rule to determine which pars (all, none, only NJ, only non-NJ) are taxable. 

Partnership income allocation

New Jersey partnerships can allocate line items separately. New Jersey uses the net of the NJ Source column of the Partnership Income Worksheet netted against the nets of any other partnerships' NJ Source columns.

New Jersey overview (1041)