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santo
New Member

Schedule C income how to get the QBI deduction with home & bus. software

I purchased your Home & Bus. software online.  Long time customer. This 2018 software does not calculate the QBI deduction automatically.

Question: Right now I am filing a Schedule C small business income & the net income should be affected by the QBI on line 9 of the 1040. Line 9 shows zero. What to do with this software to make the QBI work.

COMMENT: I also did a partnership return with this software & again no clues or instructions from Turbo Tax on how the software would calculate the QBI deduction from the K-1 small business income.

One of your customers answered my request for help & said put the K-1 partnership income in box 20 & the QBI deductions will work.  Why did not your company tell me this.

Bad software this year from a 10+ customer.  I should ask for my money back.

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3 Replies
DawnC0
Intuit Alumni

Schedule C income how to get the QBI deduction with home & bus. software

The QBI deductions are not done until you get all the way through the Schedule C.  Nothing will calculate until the very end of the self-employment/Business income entry screens.  There are a few questions you must answer in the software to trigger the QBI deduction and those questions do not come until the end of the interview.  I will include instructions below so you can get to and answer these questions so your deduction gets calculated.  

And as far as the K-1 is concerned, the QBI deductibility is determined at the entity level.  If there are QBI related amounts in Box 20, the deduction will automatically calculate.  But not every business qualifies for the deduction so these special codes must be entered by the preparer of the 1065 and K-1 form.  TurboTax does not know if the K-1 issuing partnership qualifies or not, so if no codes, no deduction.   To calculate your Schedule C deduction:

Type sch c in the search bar, click enter, then use the Jump to sch c link to get to the Schedule C entry area.  Click Edit next to the business you need to apply the deduction for.  

  • In Home & Biz, scroll all the way down and hit the Continue button.  You will start the QBI questions, see attached.
  • In TurboTax Online, scroll down to Business Summary and click on Details next to Qualified Business Income, see the 2nd image attached.    
pLo0318
New Member

Schedule C income how to get the QBI deduction with home & bus. software

I qualified for QBI but it didn't change our tax due?? Trying to file online, answered the questions and got confirmation but nothing changed.

DavidS127
Expert Alumni

Schedule C income how to get the QBI deduction with home & bus. software

More information may help resolve your Qualified Business Income (QBI) issue.  For example, what is the source of your QBI (self-employed reported on Schedule C; a Schedule K-1 from a partnership, S Corp, or trust; rental income reported on Schedule E, or a Section 199A dividend reported in box 5 of Form 1099-DIV)?

 

You can check your Form 1040 for the QBI decuction; it shows up as a subtraction on Line 10 of Form 1040.  Check Line 10 on your Form 1040 in TurboTax Online using these steps:

 

1.    Click the dropdown arrow next to Tax Tools (on the left pane)

2.    Click Tools (just below Tax Tools on left pane)

3.    In the pop-up window click View Tax Summary

4.    On the left pane click Preview my 1040

 

Check your Form 1040, Line 10 for the QBI deduction calculated by TurboTax.

 

To return to the TurboTax interview questions, click "Back" on the left pane.

 

Whatever the source of your QBI, there are certain questions you must answer in the TurboTax interview for your QBI to calculate correctly.

 

If your QBI is from a Schedule K-1:

 

Check to make sure your K-1 entry included entry of your Section 199A amounts from the Statement or STMT that came with your K-1 on the "We need some information about your 199A income or loss" and "Let's check for some uncommon adjustments" screens.

 

For a partnership Form 1065 Schedule K-1, the Section 199A Statement/STMT entry starts with entering the code Z for box 20.

 

For an S-corp Form 1120S Schedule K-1,the Section 199A Statement/STMT entry starts with entering the code V for box 17.

 

Form a trust Form 1041 Schedule K-1, the Section 199A Statement/STMT entry starts with entering the code I (India) for box 14.

 

Enter the code Z or V or I when you enter the K-1 box 20 or 17 or 14 screen, but you don't need to enter an amount.  Continue on, and you'll find the "We need some information about your 199A income or loss" and "Let's check for some uncommon adjustments" screens.  When you check the box next to a category, a place will open up to enter your amounts.  These screens (if applicable to the amount(s) on your statement) must be completed in order for your K-1 QBI information to be correctly input into TurboTax. 

 

To get back to the K-1 summary screen and find the Schedule K-1 to edit, click the "magnifying glass Search" icon on the top row, enter "k-1" in the search window and press return or enter, and then click on the "Jump to k-1" link to find the K-1 you need to edit.

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