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Level 2
posted Jun 5, 2019 3:01:57 PM

Depletion allowance From 1041 K-1

Is the Depletion allowance allocated to a Beneficiary through a 1041 K-1 ---  Is it reported on a 1040 Sch E  P III ?  as a deduction?  

0 6 2880
6 Replies
Level 2
Jun 5, 2019 3:01:58 PM

 I do have amounts in 5, 7 and 9.  5 and 7 flowed to SchE Part III,  However amount in Box 9b  did not !!  

I am over-ridding SchE Part III  Line 33(e) to get the box 9 deduction into my return.  

Expert Alumni
Jun 5, 2019 3:02:00 PM

@bud0k0c0 I don't see a problem with that if this is not a passive activity where there isn't enough income to cover the expenses.

Level 2
Jun 5, 2019 3:02:01 PM

Thanks -- went ahead and "over-rode" the deduction in Sch-e Part III Line 33(e) -- however, be aware that TT will not let you e-file with this field "over-ridden"   --- should TT allow for this deduction?

Expert Alumni
Jun 5, 2019 3:02:02 PM

@bud0k0c0 Thank you for the update and the report about what you had to do for recognition in your tax file.

Expert Alumni
Jun 5, 2019 3:02:05 PM

Yes, if you have a depletion expense it should come through to the Schedule E, Part III under either passive or nonpassive income or loss. On your 1041-K1 it should be listed in box 9 which will allow you to enter the depletion amount in TurboTax (that's the box you want to enter it in for TurboTax).

  1. Sign into your TurboTax account (online or desktop)
  2. Search, upper right,  k1 > Jump to k1
  3. Continue to make the entries for each line on your K1
  4. Click the image attached to enlarge and view for assistance.

Level 2
Jun 5, 2019 3:02:06 PM

Thank You --- Thats what I thought.   However, TT Prem does not flow the Depletion entry onto the Sch E Part III.    

Over-ridding SchE Part III Field 33(e) was the only way I could get TT to use the Depletion as a deduction.

Or maybe I am doing something wrong -- but don't see it