How do I fix error on line 12, form 4562?

[k-budding]

Form 4562: Line 12--You have elected Section 170 on multiple activities, or have a Section 179 deductions on a K-1 activity. The total amount of Section 179 you may deduct has been limited. You must reallocate the Section 179 on one or more activites.

[DianeC958 · Accepted solution]

The 179 deduction is limited to the amount of income you receive as General Partner.  If you are a limited partner you are not allowed to deduct 179 depreciation against your income.

You need to allocate the allowable amount for each K-1 you received.

In order to allocate the 179 information you will need to switch to TurboTax Desktop version.

You can download your 2019 tax file to your desktop to move all of your information to your computer. To download the file you go to Tax Tools, on the left hand side of the screen, Tools, Download my 2019 tax return.

If you have not paid for the online version you can purchase the desktop version here, or from retail stores such as Costco, Amazon and others.

If you have paid for TurboTax online you can call in and have the agent send you a download.

When you open the program you click on Find A Tax File.  This is how you upload your online file into the Desktop Version of Turbo Tax.

Once you have completed this step you can switch the Forms Mode by clicking on the icon in the Upper Right Hand corner (for PC computers).  There is a list on the left hand side of all of the forms in your tax return.  Find the K-1 forms.

Once you have clicked on the K-1 form go to Box 12 and click QuickZoom just below Box 12 to add more information about 179 deduction.  On line 2, of the Supplemental Schedule, you enter the amount that is allowed for this K-1 for 179 Depreciation.

Repeat these steps for the other K-1s you received and this will clear the error.

[k-budding]

Thanks Diane. What number do I call to have "the agent send you a download"? I have not been able to get through to a person when I call Turbo Tax. Thanks!

[ThomasM125 · Accepted solution]

You can reach TurboTax at 1-800-446-8848.

[SandraNeary]

I'm stuck in the same place. I have my turbotax copy on my pc, purchased from Costco so skip all that. This is a K-1 from an s-corp. The form says the deduction is limited to the amount in line 11 and has filled that in automatically  AND the program says that amount is not correct.  

[JBill2020]

I have this problem as well.  I am using the desktop version.  There is no quick zoom.  Line 11 is filled in at 0 and so line 12 has automatically filled in 0.  Turbotax still says this is incorrect and continues with this error.

[AbbottManor]

Switching to "desktop version" makes no sense.   There is nothing in the tools drop down box as you have directed.   Why would I need to download anything further, it should be on a form.   

[ThomasM125]

The section 179 deduction is probably coming from your k-1 entry from ownership in an S corporation or partnership. You can review the K-1 entries and change the section 179 deduction to the amount you are allowed. The section 179 amount is on line 12 of a partnership K-1 and on line 11 of an S corporation K-1.

The deduction is not allowed if you are a general partner, and is only allowed up to the amount of your income reported on lines 1 to 3 on the K-1 schedule.

[tiaelaine]

This is the first year I have seen this form and this error.  I do not have any K-1 forms nor a Schedule C.  I am a landlord with multiple properties.  The Sec 179 deductions were entered on the individual Schedule E for each property.  Now I am getting this error for which I do  not seem to find a resolution.  This also did not pop up before I updated the program (I had printed out my return in April and it had no errors).  Any ideas?

[dsprinting]

Same boat.... Anyone figure out how to make this work? TIA!

[TEXASBAGGER]

Stellar solution! I had been stumbling, fumbling and bumbling my way through this trying to fix for almost two hours. Read your suggestion and was done in under 90 seconds. Truly apprectiate you!

[1891gigi]

Like others above, my desktop Turbotax Form 4562 has the correct figure for line 12--zero-- yet it flags it as incorrect in the Federal review. What should I do? In my case, I am a limited partner and this is a carryover from 2018. It wasn't a problem when it carried over in 2019 and 2020's returns. Why is it now? Should I simply override?

[1891gigi]

Let me amend my previous post. Turbotax won't let me override its episode of schizophrenia. It's right, calls itself wrong, and won't let me correct its mistake. I need help with its Catch-22.

[1891gigi]

Another point: why did Turbotax create a Form 4562 for this carryover when it never did in 2019 or -20 after the carryover figure was originally generated in -18 and appeared in Form 4562 for a specific K-1 partnership that ended in -21? Line 11 has business income for this partnership of 0 because the final year's figure is -2. I had income greater than my carryover in 2018-20 but no 4562 was created. Why wouldn't Turbotax have taken care of that, or did I fail to make a choice that would have offset the carryover? The effect on my tax for a carryover of 231 is probably not worth the hassle of filing an amended return for one of those years. The real fly in the ointment is that Turbotax is now gagging for some reason.

[1891gigi]

One more shot. I have other partnerships with plenty of income. Can I apply that now or can only income from the partnership that generated the Section 179 deduction be applied against it?