Thanks @mlohrer , this was very helpful!
- Yes, I understand that losses are limited by the stock/loan basis. I meant the entire loss is active, not passive, so would be allowed, as long as it doesn't exceed the loan basis since my stock basis is 0. As it turns out, the loss exceeds my loan basis which is why I'm having this issue. I want to be sure to capture the remaining carryover above the loan basis.
- You were right, inputting positive numbers for the losses on 7203 fixed that problem. Thanks!
Now my issue is the next step, getting the K-1S to reflect the allowable loss from column (d) (line 36 for this part of my business) as well as carryover from column (e) on 7203 since losses exceeded the loan basis.
Here are the options I've tried on the Summary of Form 7203 screen where it says, "Please review and manually adjust your K-1 to reflect the allowed losses:"
- Leaving the "K-1 amount to adjust" box empty produces a K-1S with the allowed loss equal to the prior year ('20) suspended loss, so that's not accurate since there were additional losses in '21 and it's less than the loan basis.
- Leaving the original loss from the '21 K-1 by typing that value into the box results in a higher allowed loss that exceeds the allowed loss (equal to the loan basis), but no loss suspended for current year which I'm assuming would be the carryover. Is that assumption correct?
- Adjusting the K-1S loss (K-1S line 2 in this case) so the total allowed loss (K-1S Section A column c for lines 1a, 1g, 3 and 4b) equals the allowed loss on 7203 36(d), but doesn't produce any loss suspended for current year.
It seems like the carryover isn't flowing from form 7203 36(e) into the K-1S, but it could be operator error again.
One approach would be to input the loss required in the K-1S to match the allowable loss on the K-1S with the 7203 value (like the 3rd bullet above) and then override the K-1S form by inputting the carryover from 7203 36(d). This seems to make the most sense to me, but I'm clearly not a tax or TT expert, which is why I appreciate this forum.
Does that make sense? Any other suggestions?
