My ordinary business loss on my K-1 is not showing up on my federal return - why not?

[TerryA · Accepted solution]

That happens when you got to the K-1 entry screen Did You Participate? Did you materially participate in this activity?  you clicked the No button (there is a Learn More link there that explains about material participation). That makes the income passive and it then goes to Form 8582 and is handled there. If any of the passive loss cannot be used it is carried over to the subsequent year for you by TT.

If you did materially participate then just edit the K-1 again and change your answer to Yes.

[LLangenbrunner]

I was playing with my K-1 entries.  I said I was limited passive partner and as expected, my taxes owed when way up because it zeroed out my loss.  But then when I went back and said I was an active general manager, the loss stayed zeroed out and taxes stayed high.

I could not return to my baseline return.

[ThomasM125]

@LLangenbrunner You may need to delete your K-1 entry and start it over. Sometimes when you change things and then change them back, the program may not process the reverse change properly.

A simple way to delete forms in TurboTax online is to use the Tax Tools menu option, which is on your left menu bar when you are working in your program. Then, choose Tools and then Delete a form. Search for the K-1 form in question and use the delete option to remove it.

If you are working in the download TurboTax program, use the Forms Mode on your menu bar to bring up the form you want to delete, then choose the Delete Form option at the bottom of the form.

[LLangenbrunner]

Thanks for your tip.  I deleted my K-1 form 3-4 times and tried various ways on answering the questions and it still will not register my rental loss.  It shows zero benefit in the income section.  I don't understand.  The first time I added it, it worked fine. 

DO I need to completely restart my tax return over again?

[JamesG1]

Re-booting never hurts.  But have you reviewed Schedule E that reports rental income?

In TurboTax Desktop, view the schedule under Forms in the upper right hand corner of the screen.

In TurboTax online, view the schedule at Tax Tools / Print Center / Print, save or preview this year's return / Include government and TurboTax worksheets.

You should find the entry on Page 2 under Part II.  Is the K-1 listed under line 28?  Is the 'at-risk' question checked under line 28f?

Is there income or a $0 somewhere in boxes 28g, 28h, 28i, 28j or 28k?

The entry here gives us an idea whether at-risk, basis or other issues are restricting the reporting of the loss.