Schedule E provides insights on supplemental forms of income that flow onto a return. These can take the form of self-employment income, rental income, royalty income, or trust income, among others.
This table notes the sources for any rental, royalty, partnership or S-corporation income, though it does not include the amount. Peter and Paula don't have a Schedule E, but we've pasted a screenshot above from a sample return that does, indicating rental income and business income from a limited partnership.
Though not applicable in their case, if the taxpayer is the beneficiary of a trust, Schedule E is where that trust income shows up as reported on a taxpayer's K-1. Similarly, partnership income (from Form 1065) and S-Corporation income (from Form 1120-S) will also be reported on a K-1 and flow through to Schedule E.
As with Schedule B, any new items that you weren’t aware of that show up in this table can be good conversation topics at your next client meeting.