How can I fix TT subtraction for capital loss from QBI from Sch C earnings? I'm not an SSTB. It wasn't subtracted before. Where can I see how UBIA is calculated for QBI?

[pcnyc]

Since it's a capital loss instead of gain, shouldn't the loss be added to the QBI? Previous capital loss was not calculated into the QBI. I'm using TT Home & Business.

[Mike9241]

capital gains and losses should not affect QBI.

here did you enter the capital loss?

if it was a loss on the disposition of business assets like equipment, that's an ordinary 1231 loss that figures into QBI. it flows to form 4797 and from there to schedule 1 line 4 and not to schedule D.

[pcnyc]

Capital loss is reported on 1040 line 7. I know capital gain/loss shouldn't affect QBI, so not sure why it's deducting it.

Do you know how TT calculates UBIA? I understand QBI is based on the lower of 20% from Sch C or UBIA, but can't figure out how it's calculating UBIA.

[JamesG1]

We are not able to view your tax return.

TurboTax does not calculate UBIA.  We regularly see UBIA reported by the issuer of a Schedule K-1 (1120-S) on a Schedule A.

UBIA is routinely used in the calculation for the Qualified Business Income Deduction.  In most cases, UBIA is the original purchase price of the asset.

UBIA refers to Unadjusted Basis Immediately after Acquisition.  See Question 10 of the IRS website for an explanation.

@pcnyc 

[pcnyc]

I don't have any Schedule K-1 (1120-S) nor Sch A, so have no idea where TT is getting the UBIA info.

If TT doesn't calculate UBIA, where is the number coming from?

[ThomasM125]

The qualified business Income (QBI) deduction would be the lessor of your QBI income plus qualified REIT/publicly traded partnership income times 20%, or 20% of your Form 1040 income, net of capital gains/losses and the QBI deduction. So capital losses can factor into the equation.

I'm not sure where you are seeing the unadjusted basis of qualified business property (UBIA)  number, but it could easily be drawn from the cost and date put into service of the assets you entered in TurboTax. It would be the original cost of those assets, but only up util they had been used for 10 years.