Retained earnings not including capital loss

[baedrik]

Turbo Tax Desktop for Business auto-calcs the retained earnings without subtracting out the net capital loss for the year.  Even though I manually enter the corrected retained earnings, when it gets to Retained Earnings Reconciliation Summary, it says there is a difference from the Tax Return figure and the Books figure.  If I say I'll review later and move on to the Balance Sheet, it is using the auto-calc figure instead of what I entered, so that is off too.  How do you get it to actually use the correct numbers instead of its calculation that doesn't include net capital loss?

[ThomasM125]

Your net capital losses should appear on line 5 of schedule M-2, for your accumulated adjustments account. As such they will factor into the balance at end of year that flows to your retained earnings on your balance sheet:

So, your retained earnings should be affected by the amount of your capital losses. You may need to review your capital gains or losses entry in the Investment Income section to see if your capital losses are reflected there:

 

[baedrik]

Thanks for your reply!

For some reason I could never get it to balance things when I was in Step-by-Step view, but when I switched to Forms view, I was able to get things to balance by updating schedule M-1, line 1 to include the capital losses, so that the auto-filled line 3 would cancel out that same amount to get the correct line 10 value that doesn't include the capital loss.  And because of the update to the per book income above, it had the correct value for M-2, line 2 so that the retained earnings show the capital loss.

Thanks again!