topic My K-1 income does not appear to have the 20% QBI deduction for pass through entities being applied. The K-1 is from my S-Corp. Why? in Business & farm

My K-1 income does not appear to have the 20% QBI deduction for pass through entities being applied. The K-1 is from my S-Corp. Why?

nsalaka — Sat, 01 Jun 2019 20:53:17 GMT

The 20% QBI deduction will be reported on line 9 of your...

JulieCo — Sat, 01 Jun 2019 20:53:19 GMT

The 20% QBI deduction will be reported on line 9 of your 1040 form. See the last link below for steps to preview your 1040 form.

In order for the K-1 detail to be included in a QBI deduction, there must be amounts in Box 17 of the SCorp K-1 form with codes in the range of V to Z. If your K-1 form has amounts in Box 17 with these codes, then be sure to get all the way through the K-1 form entry section in TurboTax in order for the QBI deduction to calculate.

If there is still not a deduction reflected on your 1040 form, note that there are exclusions to Specified Service Trade or Businesses when taxable income amounts are above the thresholds of $207,500 for single and $415,000 for joint filers. In addition, certain rental activity is also excluded from the QBI deduction. See more detail in the second link below.

You can read more information about the QBI deduction here:

https://ttlc.intuit.com/replies/7019998

https://ttlc.intuit.com/replies/7122193

Here is information on how to preview your tax return before filing in TurboTax online versions:

https://ttlc.intuit.com/replies/3302322

Re: The 20% QBI deduction will be reported on line 9 of your...

HydroSci — Mon, 16 Sep 2019 01:04:05 GMT

In TT Business I cannot figure out how to complete a 1065 partnership K-1 and get the QBI without increasing the capital accounts and balancing schedules L and M-1 M-2 etc.

First: If I report bus income to Line 1 - Ordinary Business, then it accumulates automatically in the capital accounts. However, because it was paid out to the partners (husband and wife - two partners) the capital accounts should not accumulate income.

Second: I also want to distribute the income unevenly, even though the profit percentages are 50% for the two of us.

Re: The 20% QBI deduction will be reported on line 9 of your...

Anonymous_ — Mon, 16 Sep 2019 01:36:08 GMT

@HydroSci wrote:
First: If I report bus income to Line 1 - Ordinary Business, then it accumulates automatically in the capital accounts. However, because it was paid out to the partners (husband and wife - two partners) the capital accounts should not accumulate income.

Second: I also want to distribute the income unevenly, even though the profit percentages are 50% for the two of us.

The accounts will not "accumulate income" if you enter the business income proportionately distributed to each of the partners in Member Capital section for each partner. Click the Business Info tab and then Partner/Member Information.

[capital accounts (basically) = contributions + profit allocations - distributions]

You can make a special allocation election if you check "Yes" in the Makes special allocations section of the program (Business Info tab About Your Business - scroll down).