K-1 1120-S and 7203 need fixing

[leanne21]

I have a  K-1 1120-S with only box 1 and  box 17; section 199A code V, section 448(C) code AC and box 17 code AJ .

Not sure if I I put in the correct info for code V there are two numbers? Ordinary Income (loss),  or W-2 Wages?

 I'm not sure what to put in for code AJ because there are two sets of numbers, Agregate Bus Activity Gross Income or Gain - $61k and Agregate Bus Activity Deductions $60k?

Also form 7203 keeps popping up for me to fix but there is no indication as to what needs to be fixed. I can't get beyond my federal check without fixing 7203.

Please help

[ThomasM125]

In box 17, you make three entries, one using code V, one using code AJ, one using code AC and enter the numbers corresponding to those amounts as listed on your K-1 schedule. For Code V, enter the income reported. Later on you'll see a screen that says We need some information about your 199A income. Choose the option mentioning W-2 wages and enter the W-2 amount there. For code AJ, subtract the deductions from the gains and enter the difference.

If you have a Form 7203 from the previous year, you can compare it to the one in the current year and you may be able to determine what is wrong or missing.

[PatriciaV]

It's possible the Smart Check message regarding Box 17 relates to Code AJ.

Per the IRS Instructions for Schedule K-1 List of Codes and References Used in Schedule K-1 (Form 1065), Box 20 Code AJ is used for Excess business loss limitation. 

However, some partnerships choose to use this code to report Aggregate Business Activity Gross Income and Aggregate Business Activity Total Deductions, which together total Excess Business Losses for Form 461.

This information is relevant only if your net losses from all businesses are more than $313,000 ($626,000 if filing a joint return). If this doesn't apply to you, you can leave Box 20 Code AJ blank (or do not include this code).

If you do need to file Form 461, leave the amounts blank for Code AJ. You will need to complete Form 461 manually and report any deductible loss per the IRS Instructions for Form 461 - Limitations on Business Losses