Multiple QBI entities reported on K-1 line 20Z

[toddrub46]

I received a K-1 with multiple QBI entities included on line 20Z and including a statement to the K-1 detailing the income/loss by entity. The step by step process in TT only allows the input of one QBI entity under the "lead" K-1 partnership. In the "forms view" it indicates that if there are more entities to complete a separate "K-1 entry worksheet" for each one. Where do I find that worksheet or is that the same as just creating a separate K-1? When I do create a separate K-1 for the other entities, the names of those entities flow to Form 1040, Schedule E, but the entity I was able to enter using the step by step process does not. That being said, the QBI deduction amounts on Form 8995-A appear correct, so perhaps its a moot point.  However, I would appreciate some clarity on the TT entry process

[ThomasM125 · Accepted solution]

You may have to enter a separate K-1 schedule in TurboTax to report qualified business income (QBI) from each entity if reported separately on your K-1 schedule. To do so, you just need to make sure you don't duplicate any number entries, so your first k-1 entry may include more numbers than the other ones. On the supplemental K-1 entries, just report the QBI numbers that you didn't report previously. So, you are entering several K-1's reporting the same partnership name, ID number, and other identifying information, but with separate QBI entries, in this case.

A schedule K-1 entry will transfer to schedule E page 1 if it reports rental income. Otherwise it will be reported on schedule E page 2, so you may be looking on the wrong schedule E for the entry from your first K-1.

[toddrub46]

Thank you for clarifying 

[wthadiv · Accepted solution]

So if your K-1 has 3 entities that make up the numbers in box 20 (owns three other partnerships) and each one of this reported separately on Statement A, you would wind up with a total of 4 K-1's with the name of the original K-1 partner and three that contain the QBI information with the EIN's of those three partnership and the associated QBI information.  That's my understanding but just want to clarify. 

[joe_peters160]

It would be nice if Turbotax had a way to clone the K-1 information for a new entry.  I have a K-1 that has a K-3 with 16 20Z 199A entries, and it sounds like I have to make 15 copies.  That's crazy!  Turbotax should have a way to add multiple 20Z entries...

[Mike9241]

20z entries go nowhere and do not affect your return. In Turbotax, there is a subsection to the K-1 to enter 199A info that does affect your return.  i can't tell you why there would be 20 items unless you had a tiered partnership.  the issue with tiered partnerships is that the IRS has not clarified if the QBI info for each entity needs to be reported separately or if similar amounts like w-2 wages can be combined. 

the Turbotax section for 199A info for a partnership K-1may say "shareholder". this is just bad wording by Turbotax since you don't have shareholders in a partnership. Think "partner" 

this is from 1065 k-1 instructions for 20Z. I have deleted certain wording that can be ignored because the entries are made through the Turbotax k-1 interview process and are not entered directly on 8995. Turbotax completes that from your entries

QBI/qualified PTP items subject to partner-specific determinations. The amounts reported to you reflect your distributive share of items from the partnership’s trade(s), business(es), or aggregation(s), and may include items that are not includible in your calculation of the QBI deduction. When determining QBI or qualified PTP income, you must include only those items that are qualified items of income, gain, deduction, and loss included or allowed in determining taxable income for the tax year. 

W-2 wages. The amounts reported reflect your distributive share of the partnership’s W-2 wages allocable to the QBI of each qualified trade, business, or aggregation.

Unadjusted basis immediately after acquisition (UBIA) of qualified property. The amounts reported reflect your distributive share of the partnership’s UBIA of qualified property of each qualified trade, business, or aggregation.

Section 199A dividends. The amount reported reflects your distributive share of the partnership's net section 199A dividends. 

Patrons of specified agricultural and horticultural cooperatives. If the partnership was a patron of an agricultural or horticultural cooperative (specified cooperative), there are should lines in Turbotax for these 

QBI items allocable to qualified payments from specified cooperatives subject to partner-specific determinations. The amounts reported to you reflect your distributive share of items from the partnership’s trade(s), business(es), or aggregation(s), and include items that may not be includible in your calculation of the QBI deduction and patron reduction. 

W-2 wages allocable to qualified payments from specified cooperatives. The amounts reported reflect your distributive share of the partnership's W-2 wages allocable to the qualified payments of each qualified trade, business, or aggregation.

Section 199A(g) deduction from specified cooperatives. The amount reported reflects your distributive share of the partnership’s net section 199A(g) deduction.  I don't see a separate line for this so it may need to be subtracted from the coop net income