K-1 from 1065 line 20 showing Z* STMT

[ericbroder]

My situation is slightly different.  My Line 20 has "Z *STMT", but there's no Statement.  Could it be because Z refers to QBI but my K-1 showed a loss and I'm therefore not eligible for QBI?  If so, do I just ignore the Code Z on Line 20 (I also have an AG code on that line that I know I need to input)?

[MarilynG1]

@ericbroder Per Expert @DavidS127:

"Enter the code Z when you enter the K-1 box 20, but you don't need to enter an amount. Keep going through the K-1 interview, and there is a screen near the end of the interview titled "We need some more information about your 199A income or loss.

You don't need an amount on the box 20 line of the K-1 for your QBI to calculate.  The QBI calculation is "driven" from the entries in Sections D1 and D2 of that K-1 Partner form.

Click this link for more info on K-1 Line 20 Code Z.

This link has instructions on How to Enter Form K-1. 

[JJGJR1]

I've been stuck  for days on this issue of form 1065 K1 Box 20 code Z. i successfully got through it the last two years but now it TT won't process because it doesn't like my entry for the above. It is an oil and gas partnership and I have two lines of data for Code Z: Ordinary income (Loss ) $-465, and Unadjusted  Basis of assets $2437.

Thanks for your help.

[denverguy]

It's pretty disappointing that this issue wasn't resolved with this year's edition. If for some reason, it is in fact correct, TT could have issued some guidance.

I've been a loyal TT user for years and used a competing product this year because of this issue. 

[JJGJR1]

I've been stuck  for days on this issue of form 1065 K1 Box 20 code Z. i successfully got through it the last two years but now it TT won't process because it doesn't like my entry for the above. It is an oil and gas partnership and I have two lines of data for Code Z: Ordinary income (Loss ) $-465, and Unadjusted  Basis of assets $2437.

I have even deleted the K1 and re-entered all the info but I am in the same loop as before. TT won't finish, demanding that i review my Code Z entries. Thanks for your help.

[JJGJR1]

I've been stuck  for days on this issue of form 1065 K1 Box 20 code Z. i successfully got through it the last two years but now it TT won't process because it doesn't like my entry for the above. It is an oil and gas partnership and I have two lines of data for Code Z: Ordinary income (Loss ) $-465, and Unadjusted  Basis of assets $2437.

I have even deleted the K1 and re-entered all the info but I am in the same loop as before. TT won't finish, demanding that i review my Code Z entries. Thanks for your help.

[JamesG1]

Try these steps.

• At the screen Enter Box 20 info, you likely need to select code Z Section 199A information. 
• Enter the Box 1 value.  Click Continue.
• At the screen We need some information about your 199A income, you will likely need the following information:

• Ordinary business income (loss) from this business,
• W-2 wages (if you have any to report),
• UBI of qualified property for this business.

Enter these values for the qualified business income deduction to be calculated.

Since box 1 is negative, there will be no QBI deduction unless there is QBI somewhere else in the tax return.

[JJGJR1]

Thanks. That did the trick. Taxes filed!

[fla_33801]

Where do I find the amount to put in Box 20Z from my K-1?

[tagteam]

---

@fla_33801 wrote:

Where do I find the amount to put in Box 20Z from my K-1?

---

You should have received some sort of supplemental statement along with your K-1.

If not, contact the individual or firm responsible for preparing the 1065.

[glfnrtrvr]

Thank you.

Your answer made the most sense and is appreciated!

I want to mark it as The Best Answer. But I cannot find where to do that.

[Billyboy3]

So, I fully agree that we should not override the info on the K-1.  However, my predicament is that in Box 20 - Code Z, it indicates "0".  The supplemental statement for the "subcodes" all indicate zero's.  Turbo Tax seems to question this figure.  I've tried to "trick" the system by typing in $0.001, but that doesn't work either.

  All of this said, I have already contacted the tax provider TWICE and they have confirmed that the figures are correct on my K-1.  That said, I'm fully expecting to be notified that an Amended K-1 will be forthcoming at some point.  (FYI, they checked the "K-3 Included" -Box 16- when the cover letter plainly states that they are NOT including a K-3 at this time.... oy veh!)

[Munzer1]

I already entered form 1065 in Turbo Tax (TT) 2021 Delux desktop version. But TT is not processing K-1, and not populating schedule E, for real estate depreciation (should have been on line 18) and therefore no data about depreciation on form 1040 either. Any idea why?

[tagteam]

---

@Munzer1 wrote:

Any idea why?

---

Rental real estate expenses, in this case, are deducted at the partnership level.

Your K-1 will show net rental real estate loss or income.

[curt504]

Hi, I;ve been filing 1065 for some 20 rentals using TT for many years.

The point / benefit of moving your rentals off your 1040 (sched E) up to a multi member LLC (1065) is to reduce the audit risk at th0 1040 level, and have the liability and management benefits of the LLC.

The end result of a 1065 --> k-1 --> 1040 is that there is no longer Sched E's on your 1040.   The depreciation, income (net of expenses and depreciation) is all up in the 1065.  The kk-1 transfers into the 1040 the net of the numbers.  

In your 1040 find the area where you enter business income, there/s a place to manually enter any/all kk-1s.   TT does not automatically import the k-1 into the 1040.  All k-1 entry is manual.

Your 1040 taxes due will reflect the net of all your sources of income.

When you file your 1040 attach all your k-1s and w2s etc.

As a past software developer,  TT could be alot smarter about these things.  But TT business has never advanced beyond a fancy form editor with minimal logic and helps.   you really have to now tax code at the 1065 level especially;   179,  bonus 179,  de--minimus, what numbers from your books go into cost basis,  etc.

A good read is biggerpockets.com book;  advanced real estate taxes,, or similar title.  Buy the newest version.   Buy them all i did, reading about real estate tax code is a HUGE help when using TT, IMHO its essential.

[Munzer1]

I entered all the data from the physical copy of multiple K-1 to TT K-1 forms. My all K-1 is from multi-family, multiple partnership LLC. I invest as passive individual investor. Form 8582 page 2 shows the total loss of all K-1 combined but says “Unallowed Loss” for each of the K-1 depreciation amount. So, I do not get to deduct any depreciation in my form 1040. Is this normal or TT did not process the K-1 correctly?

When I will be able to take the depreciation loss? I thought, I could take the full depreciation from the very first year.