ChrisY1966, I have exactly the same question and issue except my royalties are paid to a Limited Partnership. Did you get an answer to your question? Sometimes, TurboTax hides some small checkbox that affects how income flows from that point forward, but I went back through TurboTax Business, paying close attention to that sort of thing and everything I did seems to be correct. Up front, my business is identified as a Limited Partnership with oil and gas royalties. Further on in the income section, I clearly entered the royalties as royalty income, so it should flow properly. I have 3 partners, counting myself and 3 income categories: royalties, interest & ordinary business expenses. The info flows correctly to the K-1 with expenses showing negative in Part III, Line 1, interest on line 5 & royalties on line 7 but it get hosed up on the PA RK-1 & NRK-1 where the net income shows as PA taxable income on line 1 & nothing on line 5, royalties (RK-1) or line 3, royalties (NRK-1). The issue I have with TurboTax Business is that it doesn't populate Partner's Capital Account data in Block L of the K-1. I'm going to keep researching but hope to get an answer. Let me know if you get resolution on this issue. Thanks.
