Qualified Business Income (QBI) does not include “investment items” such as capital gains or losses. So, what the TurboTax software is calculating on the Schedule K-1, Line 20 QBI Pass-through Entity Reporting Statement is the QBI reported to partners, which by definition excludes the portion of partnership income that represents the capital gain.
Use “Forms” mode (icon at upper right, blue panel) to look at the “199A Act Wks” and “199A Stmt A Sum” worksheets for the calculations on the QBI Pass-through Entity Reporting Statement. You can also use Forms mode look at the Form 4797 for the calculation of the taxable amount of your asset disposition, as suggested by Community user ThomasM125.
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