So I’m confused how these work, at least with respect to MLPs/PTPs. I always assumed this was just something Turbotax handled internally. But I found this article about them, and now I’m not sure if I’m doing this right or not. See https://www.journalofaccountancy.com/issues/2020/nov/sec-199a-qualified-business-income-deduction-ne...
According to this author, negative QBI from one business is to be distributed proportionately across any others having positive QBI, thereby offsetting it. Turbotax, as far as I can tell, has not been doing this. I have negative QBI in most years from my MLPs that just gets carried over and accumulated year to year (individually for each).
By contrast, I have positive QBI from reits that Turbo gives me the 20% deduction on in full, I think. Instead of this, should these two QBI sources net with each other annually? What’s more, the article goes on to say that any remaining negative QBI gets aggregated at the end of a tax year and carried over to the next year. This would seem to obviate any MLP-specific carryover, even though Turbotax provides a QBI loss carryover worksheet for each MLP.
I assume MLP QBI must just be somehow different from other business QBI. At what point do negative QBI carryovers become unsuspended? Only when a particular MLP has positive QBI in a tax year, and then only for that MLP’s QBI carryovers? Turbotax seems to think so. For midstream O&G, that's rarely the case.
What happens to all this negative QBI carryover when a partnership is sold? Or after 2025, assuming the TCJA that created QBI isn’t extended?
