@DaveF1006 ,
My Schedule K-1's Box 20, Code Z - Section 199A information has information in four columns. The first column is "Management" and only shows ordinary business (loss). The remaining three columns show three business locations and each has an EIN. The locations have ordinary business income (loss), W-2 wages, and qualified property.
My understanding from your many posts on this topic is that I will enter a Schedule K-1 that looks exactly like the K-1 I received. All of the information in Parts I, II, and III will be entered exactly as seen. I will select code Z in box 20 and hit continue.
I then receive the, "We see you have Section 199A income" where I can select either, "The income comes from the partnership that generated this K-1" or "The incomes comes from another business."
Would I:
- Select "The income comes from the partnership that generated this K-1" so that I don't have to enter an EIN for the management company (column A of the Section 199A information worksheet... which does not have an EIN listed) and then on the "We need some information about your 199A income" I would select only the Management LLC has business income (loss) box and enter the value from column A. This will only be a portion of the value in Part III, box 1.
- Create three new K-1s in TurboTax, each that have the same information from Schedule K-1, Part 1 but then only enter in the necessary information from Part II, G (general or limited partner) and H (domestic or foreign partner). Do not fill in section J or L for these pass-through entity K-1s (?). Do not enter anything in boxes 1-19 but do select code Z in box 20 again (with no value entered). This time when prompted about Section 199A income, I will indicate that the income comes from another business and on the next screen I will enter the name and EIN of a location (columns B-D for the three additional K-1s I'm creating). This time I will indicate that I have business income (loss), W-2 wages, and UBIA of qualified property and will enter the values from each of the columns.
If I add the net income (loss) values from the main K-1 with the management company's information (from column A) and the three additional Schedule K-1s created with only box 20 / code Z selected, they should add up to the value on the original K-1 that looks like the one I was sent, correct?
Additional related questions:
3. In Part II, Section K there are values on the nonrecourse and recourse lines. A Schedule K-1 Activity Worksheet shows the box K information for each location. Of the four Schedule K-1s I've created above, should these values be entered on only the main K-1 or not on the main one and instead on each of the pass-through entity (business location) K-1s?
4. In Part II, Section L there is another "STMT" next to the "Other increase (decrease)" row. My additional information shows an equity increase for one of the locations and an equity decrease (different value) for another location. Of the four Schedule K-1s I've created above, should this be entered into TurboTax anywhere? Or just enter it as-shown on the main K-1?
5. I do have an amount in box 17 with a code of A: Depreciation adjustment post 1986. I know which location it is associated with from the supplemental information. Following your guidance that only box 20, code Z should be filled out on the pass-through entity K-1s, should I keep this entry and value on the main K-1 and not associate it with the location's K-1? If I should put it on the K-1 associated with the location, then does it only go on that K-1?
Statement to all others: Please do not consider the steps I've outlined here to be guidance. I am clearly confused and seeking guidance. Wait for a professional to confirm my assumptions and/or provide additional details. But hopefully my example, my questions, and others' guidance will be of use to others.
