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nomisr2
New Member

S-corp here: On schedule K1 box 17 (199a QBI deduction). Assume I meet all 199a requirements. I have 100K in QBI code V...do I enter 100K in box 17 or 20K (20% of QBI)?

 
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Accepted Solutions
DanielV01
Expert Alumni

S-corp here: On schedule K1 box 17 (199a QBI deduction). Assume I meet all 199a requirements. I have 100K in QBI code V...do I enter 100K in box 17 or 20K (20% of QBI)?

You enter 100K as reported in Box 17 code V.  The program will calculate how much of the 100K qualifies for the QBI deduction and what the deduction is.  If you meet all of the requirements, and input 100K in box 17, you will see 20K reported in Box 9 on your return.  But it is not automatic, because the QBI calculation can be quite complicated.  That is why it is important to enter the information as you see it on your K-1 and answer the appropriate questions to ensure you are getting the correct calculation on your return.

Please note these input instructions:

  1. Under Wages and Income, scroll down to the Subheading Business Income, and select K-1.  
  2. On the screen Choose Type of Activity select whether it is Business Income or Rental Real Estate, (if business income, answer questions regarding your stock ownership and Material Participation, if rental real estate, answer the appropriate questions about being a Real Estate Professional, Active Participation, and Special Handling.)  It is also important that the income amounts themselves be reported in Box 1 or Box 2, depending on if it is Business Income or Rental Income.
  3. On the screen Check Boxes That Have an Amount, you should select Box 17 info.
  4. You should see codes V and W on the K-1 (if you do not, this is would be one reason why the QBI does not calculate.  This information must be entered from the information on the K-1 for QBI to calculate).
  5. Select any that apply on the screen Other Situations, and any information to the question Did this business receive qualified payments from a cooperative.
  6. Answer the question about anticipated income on the next screen, We're almost done.  If anticipated income is below the threshold, QBI will calculate after that screen.  If above, you will provide additional information, and QBI will calculate according to the final results of the calculations.

This FAQ explains in more detail  (click on the View the entire answer, and then the embedded link  How is the deduction calculated? (Not for the faint of heart!):  https://ttlc.intuit.com/replies/7019998 

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7 Replies
nomisr2
New Member

S-corp here: On schedule K1 box 17 (199a QBI deduction). Assume I meet all 199a requirements. I have 100K in QBI code V...do I enter 100K in box 17 or 20K (20% of QBI)?

Thank you very much for the answer, this confirms my thinking.  My confusion is with the schedule K1 then  - box 17 IRS instructions/worksheet will have 20K entered on the schedule K1 (in this example of 100K QBI).  So the K1 wants the QBI "deduction" of 20K and TurboTax wants just the QBI of 100K (so TT can make the calculation)?  Is this right??  Thanks again for your time here.
DanielV01
Expert Alumni

S-corp here: On schedule K1 box 17 (199a QBI deduction). Assume I meet all 199a requirements. I have 100K in QBI code V...do I enter 100K in box 17 or 20K (20% of QBI)?

What is reported on your Schedule K-1 is what is "passed through" to you via the S-Corp.  Truth be told, the 20% comes from the lower of box 1 (or box 2 if it's rental income) and Box 17.  (Hopefully the numbers are very similar).  Box 1 says how much you received, and Box 17 qualifies how much your distributive share of corporate income is qualified business income for the purpose of the deduction.  If you look through the instructions and the FAQ, TurboTax needs all of this information to accurately calculate the deduction.  Not everyone qualifies for the full 20% deduction, so the information is important.
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nomisr2
New Member

S-corp here: On schedule K1 box 17 (199a QBI deduction). Assume I meet all 199a requirements. I have 100K in QBI code V...do I enter 100K in box 17 or 20K (20% of QBI)?

Thanks again...very helpful.  So in my very simple example (100K Code V...no rental, no wages) - my S-Corp Schedule K1 has: box 1 = 100K ...box 17 = 20K.  My 1120s K1 box 1 has 100K...box 17 also has 100K.  Do I have my S-Corp Schedule K1 box 17 wrong...should it be 100K...not the 20K?
DanielV01
Expert Alumni

S-corp here: On schedule K1 box 17 (199a QBI deduction). Assume I meet all 199a requirements. I have 100K in QBI code V...do I enter 100K in box 17 or 20K (20% of QBI)?

Box 17 should say 100K, yes.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
nomisr2
New Member

S-corp here: On schedule K1 box 17 (199a QBI deduction). Assume I meet all 199a requirements. I have 100K in QBI code V...do I enter 100K in box 17 or 20K (20% of QBI)?

Thanks again, very much appreciated.
DanielV01
Expert Alumni

S-corp here: On schedule K1 box 17 (199a QBI deduction). Assume I meet all 199a requirements. I have 100K in QBI code V...do I enter 100K in box 17 or 20K (20% of QBI)?

You are welcome.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
DanielV01
Expert Alumni

S-corp here: On schedule K1 box 17 (199a QBI deduction). Assume I meet all 199a requirements. I have 100K in QBI code V...do I enter 100K in box 17 or 20K (20% of QBI)?

You enter 100K as reported in Box 17 code V.  The program will calculate how much of the 100K qualifies for the QBI deduction and what the deduction is.  If you meet all of the requirements, and input 100K in box 17, you will see 20K reported in Box 9 on your return.  But it is not automatic, because the QBI calculation can be quite complicated.  That is why it is important to enter the information as you see it on your K-1 and answer the appropriate questions to ensure you are getting the correct calculation on your return.

Please note these input instructions:

  1. Under Wages and Income, scroll down to the Subheading Business Income, and select K-1.  
  2. On the screen Choose Type of Activity select whether it is Business Income or Rental Real Estate, (if business income, answer questions regarding your stock ownership and Material Participation, if rental real estate, answer the appropriate questions about being a Real Estate Professional, Active Participation, and Special Handling.)  It is also important that the income amounts themselves be reported in Box 1 or Box 2, depending on if it is Business Income or Rental Income.
  3. On the screen Check Boxes That Have an Amount, you should select Box 17 info.
  4. You should see codes V and W on the K-1 (if you do not, this is would be one reason why the QBI does not calculate.  This information must be entered from the information on the K-1 for QBI to calculate).
  5. Select any that apply on the screen Other Situations, and any information to the question Did this business receive qualified payments from a cooperative.
  6. Answer the question about anticipated income on the next screen, We're almost done.  If anticipated income is below the threshold, QBI will calculate after that screen.  If above, you will provide additional information, and QBI will calculate according to the final results of the calculations.

This FAQ explains in more detail  (click on the View the entire answer, and then the embedded link  How is the deduction calculated? (Not for the faint of heart!):  https://ttlc.intuit.com/replies/7019998 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
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