The source of our Karma is Free Will. All life forms possess it. It is the distinguishing feature of life much more so than ability to reproduce etc. as defined by scientists because after all a sterile person is a life form too. Whenever we exercise our free wills and make a choice or carry out an action based on that choice, it will influence some other life form or some other part of the Universe and most importantly our own soul and it may therefore generate Karma.
I used the word “may” in the last paragraph because karma may not be generated at all. The Universe as a whole has a Will also, but the Universe does not accumulate karma in the exercise of that free will, because it does not influence anyone but itself. We are all parts of the Universe. We may not realize that fully but the universe is never in doubt of that.
It is possible to align one’s free will with that of the Universe in a spirit of service and when we carry out actions based on that we may not accumulate any Karma. The mighty angelic spirits of the Universe do that most times. Therefore, they do not accumulate Karma most times –either good or bad. Good Karma is a reward but it has its limitations. It lasts for a limited duration. When that good karma is exhausted one is at a loss and back to square one. The angels don’t need that. Their needs are met directly by the Universe since they spend their time in sharing the work of the Universal Consciousness. Different Humans do that to different degrees and to that extent do the work of the angels, (gods, devas and the evolved compassionate spirits included) and to that extent the Universe meets their needs directly.
This work of the Universe is different from service for nature and humanity merely in order to be good and not out of compassion, because service is a good deed and generates good karma. The universe does all kinds of things, some that are regarded as bad by beings affected adversely by it such as earthquakes and hurricanes besides sunshine and the music of the birds. How are we to know what the will of the Universe is? That is an altogether different matter and needs a separate discussion some other time.
There are other ways in which significant Karma may not be generated, because the accumulation of Karma depends on the associated intentions, motivations and emotions rather than the action itself. Thus, if you stepped over an insect and killed it unknowingly yesterday while out on a walk, no bad karma is generated for you personally. However if you killed one slowly and derived gleeful pleasure as you watched it writhe in pain, then a similar karma may await you some day. A military man who kills hundreds of enemies in a war on instructions from his superiors for the protection of his country generates no significant bad Karma whereas another who kills a single person out of anger or for gain accumulates bad karma that invites a similar fate for him sometime in the future. It appears that it is not just the action but its impact on our inner self or souls that decides karma. Thus an action committed at the level of thought that impacts deeply on our soul will generate karma whereas another action actually committed unknowingly will produce none.
The universal eye however misses nothing and our record of deeds is written on our souls and the firmament of the Universe. Based on that the Universe will draw out an individual lesson plan for our education, that education is the unfolding of our individual Karma. We could by pass some of that unfolding through self-study such as (meditation, reflection, prayer or service) or by earning extra credits by doing things like forgiving others who have wronged us. Then as a result some of our similar Karma would be forgiven too. However all such karma that needs action by Nature for the evolution of our soul towards knowledge and compassion will be dealt with by nature. In this karmic education there is no canceling of good and bad karma. The results of both have to be experienced separately. One cannot pass the Language exam by getting extra points in Mathematics.