Which ETFs issue K1?

Which ETFs Issue K-1 Tax Forms?

If you're investing in certain exchange-traded funds (ETFs), you might have encountered the dreaded K-1 tax form. Unlike most ETFs that issue simple 1099 forms, some specialized funds issue Schedule K-1 (Form 1065), which can complicate your tax filing. These are typically not standard stock or bond ETFs—they’re structured as partnerships for tax purposes, meaning they pass through income, deductions, and credits directly to investors.

Popular ETFs that issue K-1s include volatility and commodity-based funds such as VIXY (VIX Short-Term Futures ETF), VIXM (VIX Mid-Term Futures ETF), UVXY (Ultra VIX Short-Term Futures), and SVXY (Short VIX Short-Term Futures). These ETFs track VIX futures and are structured as limited partnerships, hence the K-1.

Commodity-focused ETFs like UCO (Ultra Bloomberg Crude Oil), BOIL (Ultra Bloomberg Natural Gas), and UGL (Ultra Gold) also issue K-1s. These funds often use futures contracts and are taxed under the “mark-to-market” rules, leading to complex reporting.

Why does this matter? K-1 forms often arrive later than 1099s—sometimes in March or even April—making tax preparation more stressful. They also require you to report your share of the fund’s taxable income, even if you didn’t receive cash distributions. Plus, losses in these funds may be limited if the K-1 shows you didn’t have sufficient basis.

Before investing in these ETFs, consider the tax implications. While they offer unique exposure to volatile markets or commodities, the K-1 adds a layer of complexity. For buy-and-hold investors, simpler alternatives structured as corporations may be easier to manage come tax season.