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Level 3

What is the correct way to input NOL from last year?

What is the correct way to input NOL from last year for the following situation? -

 

  • 2018 K1 / 1120S loss = $200K
  • 2019 K1 / 1120S income = $50K

 

  • Schedule 1 is showing Part 1 Additional Income Line 5 S Corp = negative $150K

 

  • Schedule E, p2 is showing the following -
    • Part II Line 28 A (k) Nonpassive Income $50K
    • Part II Line 28 B (i) PYA (prior year)  Loss K1  $200K
    • Line 32 Total S Corp loss = $150K
    • Form 1040 Line 7a = negative $150K

Can this be right way to report the prior year carryover NOL?  

 

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Accepted Solutions
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Level 15

What is the correct way to input NOL from last year?

@asanyal 

 

You need to provide additional details concerning your K-1s because what you posted for the years thereof is confusing.

 

Particularly, you mentioned a 2018 K-1 with a loss and a 2019 K-1 with income with both, apparently, originating from an S corporation (1120-S) and then later indicated some sort of combination of the two figures. 

 

Note that the 2018 K-1 should have been entered into your 2018 individual income tax return; it appears as if you are now combining that K-1 with the 2019 K-1 which, of course, is not the correct procedure.

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Level 15

What is the correct way to input NOL from last year?

Click the Business tab and scroll down to the Less Common Business Situations section. Click the Start or Update button to the right of Net Operating Loss/QBI Carryforward Loss.

 

 

View solution in original post

6 Replies
Highlighted
Level 15

What is the correct way to input NOL from last year?

@asanyal 

 

You need to provide additional details concerning your K-1s because what you posted for the years thereof is confusing.

 

Particularly, you mentioned a 2018 K-1 with a loss and a 2019 K-1 with income with both, apparently, originating from an S corporation (1120-S) and then later indicated some sort of combination of the two figures. 

 

Note that the 2018 K-1 should have been entered into your 2018 individual income tax return; it appears as if you are now combining that K-1 with the 2019 K-1 which, of course, is not the correct procedure.

View solution in original post

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Level 3

What is the correct way to input NOL from last year?

  • 2018 K1 / 1120S loss was $200K
  • 2019 K1 / 1120S income is $50K

 

2018 K1 Loss was reported in individual 1040 in 2018 to result in negative AGI of -$200K.

 

Where do I input the AGI of -$200K to carry over from 2018 to 2019 in TT Home & Biz?

 

Thank you.   

Highlighted
Level 15

What is the correct way to input NOL from last year?

Click the Business tab and scroll down to the Less Common Business Situations section. Click the Start or Update button to the right of Net Operating Loss/QBI Carryforward Loss.

 

 

View solution in original post

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Level 15

What is the correct way to input NOL from last year?

Also, note that for losses arising in taxable years beginning after Dec. 31, 2017, the net operating loss deduction is limited to 80% of taxable income (determined without regard to the deduction).

 

See https://www.irs.gov/publications/p536

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Level 3

What is the correct way to input NOL from last year?

I appreciate your response.  Would the following procedure be correct? -

 

  • Input 2019 S Corp income of $150k from K1 into Schedule 1 Line 5
  • Input 2018 AGI Loss carryover of $200k in Schedule 1 Line 8 as NOL/QBI Carryforward Loss (from Less Common Business Situations in TT Step by Step)

Thank you.

Level 15

What is the correct way to input NOL from last year?

Yes, but please recall that your NOL deduction is limited to 80% of taxable income before the deduction.

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