I am a member of a 3 person LLC that owns a farm (for recreation/hunting). I pay a CPA to have the farm taxes completed and it shows a negative value on line 2 of my Schedule K-1 (From 1065). I transferred that loss to my schedule C line 1 and then I checked the box on line 32A. My tax summary at the end shows a high risk of audit with verbiage that doesn't sound like I did it right so I am thinking that is not the correct place for the negative value? I think that negative value on my LLC 1065 is Net Rental income so it makes sense that it is not strictly 'business loss'? Any advice?
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The amount from your K-1 does NOT go on Schedule C.
There is a section of the program to enter your K-1, and you need to enter it there.
To enter a K-1 go to
Federal Taxes Tab or Personal (Home & Business version)
Wages and Income
Then scroll way down to Business items
Schedules K-1, Q - Click the Start or Update button
Be sure to pick the right kind of K-1. There are 3 kinds, 1041, 1065 & 1120S
Enter each k-1 separately.
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