A follow-up to this question, if I may: I'm also having issues with boxes 9c and 10, though my situation is also somewhat different.
In the K-1 provided by the accountant who worked on the sale, the sum of boxes and 9c and 10 exceeds the total amount of the sale. He said (quoting from an email), "The Section 1250 gain (line 9c) claims priority in this situation, so the $XXXX will be the full Section 1250 gain. Line 10 (the 1231 gain) will be netted against the 1250 gain, so the remaining amount will be the 1231 gain. In this case, you would subtract the 1250 gain ($XXXX) from the line 10 amount to get the Section 1231 amount ($XXXX)."
This makes sense to me, since (as mentioned above), adding the two would yield a number that was way too big. The total gain would be split into the part that can take advantage of the 1250 provisions and the part that cannot... though in our case, I don't believe that distinction matters.
But here's the problem: if I enter the numbers into the TurboTax K1 form, as they appear in the Schedule K-1 provided by that accountant, I get a number that is way too high (as measured by the change in the "Federal Tax Due" window). But if I put the difference into the form instead, the result is much closet to what I expected, but it also seems too low... or maybe I'm not calculating my expected liability correctly.
We are married, filing jointly, and our taxable income falls within the $80,800 to $501,600 window. So I'm expecting for the "Federal Tax Due" to go up by 15% of the gain in line 10. Since the accountant's instruction was to subtract line 10 from line 9c to net the 1231 gain against the 1250 gain, and I believe that in our income bracket and situation the two should be treated the same, the line 10 number is my guide since [line 10 - line 9c] + line 9c] = line 10
Have I missed something (i.e., a reason why our tax liability should be less than 15% of the gain), or is there something different I should be entering into TT in order to force the tax owed to increase by the expected amount?
Thanks!
