Why does TT put the cap. gains on my spouses AGI so he cant get any IRA ded.? We both want to contribute $6500 to IRA and only mine is fully deductible and he gets 0

[drdhoward]

We file married filing jointly. He has W-2 income and my businesses show very small income. 

[DanielV01]

Does he have a pension plan at his work?

[drdhoward]

yes

[dmertz]

On a joint tax return there is no individual AGI, only a joint AGI.  Capital gains are includible in AGI.

As TurboTaxDanielV said in the answer, your spouse's traditional IRA contribution is not deductible because your (plural) AGI is above the limit which prevents his contribution from being deductible because he is covered by a workplace retirement plan, while you are not.

[DanielV01]

That is why he's limited and you are not.  Since you sound like you are a sole proprietor, you are not covered by a retirement plan at work, so your individual limit to claim a deduction for your IRA is higher than your husband's.  What limits him is not his capital gains, but rather the pension plan at his job that limits him.  

Click on the following links below to see the difference between his Traditional IRA deduction limit and your Traditional IRA deduction limit:  

IRA Deduction if You ARE Covered by a Retirement Plan at Work - 2018

IRA Deduction if You Are NOT Covered by a Retirement Plan at Work - 2018 (deduction is limited only if your spouse IS covered by a retirement plan)