1099-PATR

Box 6. Section 199A(g) Deduction

For specified agricultural and horticultural cooperatives only, enter the patron's share of the amount of section 199A(g) deduction claimed by the cooperative under section 199A(g) and passed through to the patron. This amount must have been designated in a written notice sent to the patron from the cooperative within the payment period under section 1382(d). The deduction allocated to each patron cannot exceed 9% of the qualified payments reported in box 7 and cannot be passed through to patrons that are C corporations. Do not reduce the amounts reported in box 1 or box 3 by the amount reported in box 6.

Note.

 

The cooperative must reduce its section 1382 deduction by the amount of the section 199A(g) deduction passed through to its patrons.

 

Box 7. Qualified Payments

For specified agricultural and horticultural cooperatives only, enter the qualified payments paid to the patron. You are required to provide this information whether or not you pass any of the domestic production activities deduction (DPAD) through to the patrons. See section 199A(b)(7).

 

 

Box 8. Section 199A(a) Qualified Items

Enter amounts reported to the patrons that are qualified items of income, gain, deduction, or loss from qualified trades or businesses that are not a specified service trade or business (SSTB) for purposes of section 199A. Examples of income that are not qualified items include tax-exempt income, capital gains, and income that isn't effectively connected with the conduct of a trade or business within the United States. See the Instructions for Form 8995-A for more information on qualified items. Report items relating to SSTBs separately in box 9.

 

Instructions for Form 1099PATR

 

Most often, your Form 1099-PATR reports dividends associated with a farm or cooperative (co-op). You can also receive a 1099-PATR for other reasons (for example, a land bank mortgage or backup withholdings made on your behalf).

Tip: If the dividends in Box 1 of your 1099-PATR came from property purchased for personal use (or capital assets or depreciable property used in your business), you don't have to enter your 1099-PATR. Keep it with your tax records, though.

To enter a 1099-PATR for farm or co-op dividends:

1. Open (continue) your return in TurboTax.
2. Inside TurboTax, search for 1099-PATR (be sure to include the dash) and then select the Jump to link in the search results.
3. Follow the instructions to enter info about your farm.
4. When you get to Your Farming Income and Expenses, you will enter your 1099-PATR info in Livestock, grain, produce, custom work, co-ops.

If your 1099-PATR isn't for farm or co-op dividends, it gets entered as general business income:

1. Open (continue) your return in TurboTax.
2. Inside TurboTax, search for business (schedule c) (use this exact phrase) and then select the Jump to link in the search results.
3. When asked Did you have any self-employment income or expenses? answer Yes.
   1. If you'd previously entered self-employed income, you'll come to Your 2020 self-employed work summary. Select Add another line of work to enter information about your farm.
4. Follow the instructions to enter info about your farm.
5. When you get to Let's enter the income for your (type of farming) work, select Other self-employed income and Continue.
6. Enter the information from your 1099-PATR on the Tell us about other self-employed income screen.

Where do you enter the amounts in box 7 and 8 of the 1099-PATR? I entered boxes 3 and 4 on the line for Total Income from a Cooperative. But I think the amounts in boxes 7 and 8 (they are the same number) need to be entered for the QBI to calculate. 

QBI income reported on Form 1099-PATR Boxes 7 & 8 is entered in the QBI section for your Farm. 

 

Edit your Farm and scroll to the bottom to click Continue. Indicate that it is QBI income and continue to the page "Qualified payments from a cooperative" where you can enter the additional info from 1099-PATR. Be sure to read any blue hyperlinks on these pages for additional info (ex: Learn More).

This is also for a farm.

I followed the instructions.  Still nothing to enter for lines 7, 8, 9, and 13. or it is unclear how to enter it.

It list:

Net income allocable to qualified payments.   ( What should be entered here?)

 2 entries for line 6    before or after January 1, 2018

 

Also I belong to 4 coops.

3 coops send a 1099 patr.      1 coop sends the information in a monthly bill.    Just the amount of $$.$$   that I have earned for the year.   no 1099 patr.

1st coop has info. in boxes  1, 3, 7, 8 and 13. no info in box 6 and 9

2nd coop has info. in boxes  3, 7, 8, 9 and 13. no info. in box 1 and 6

3rd coop has info. in boxes  1 and 8.  No info. in boxes 3, 6, 7, 9, and 13. 

How do I break all info down. 

It would be nice to enter this info the same way as the other 1099 int and div are entered.

I have been using turbo tax for years. without this problem.

thank you.

Mac76a

The review of the boxes and what they represent are discussed below.  Once you finish all farm entry you click Continue at the bottom and the qualified business income deductions (QBID) will be asked and TurboTax will do the rest (see the image below).  There is some repetition but I though having them all in one place might be easier. 

 

Box 3: A per-unit retain allocation is an amount paid to patrons for products sold for them that is fixed without regard to the net earnings of the cooperative. These allocations can be paid in money, other property, or qualified certificates. This would be income to you.

 

Box 5: When nonqualified notices are redeemed in cash or other property, the cooperative deducts the payments to patrons from its income, and a patron who receives a redemption includes the amount of the payment received in taxable income.

 

IRC Section 199A  is for the new qualified business income deduction (QBID) which is derived from business or farm income. The following boxes on your Form 1099-PATR pertain to that deduction.

 

Box 6 is a deduction, if allowed: The deduction allocated to each patron cannot exceed 9% of the qualified payments reported in box 7. Only eligible taxpayers, which does not include a C corporation that is not itself a specified agricultural or horticultural cooperative, may claim a section 199A(g) deduction that is passed through. Do not reduce the amounts reported in box 1 or box 3 by the amount reported in box 6.

• This is similar to the deduction under former section 199, which was known as the domestic production activities deduction. Section 199A(g) allows a deduction for income attributable to domestic production activities.

Box 7 is For specified agricultural and horticultural cooperatives only, enter the qualified payments paid to the patron. You are required to provide this information whether or not you pass any of the section 199A(g) deduction through to the patrons. This is the payment made to your from the profit. Information but not reported as income from this box.

 

Box 8 is for qualified items of income, gain, deduction, or loss from qualified trades or businesses that are not a specified service trade or business (SSTB) for purposes of section 199A. (Net profit from the business or farm activity - information and not income to you.)

 

Box 9. Shows amounts received and reported in boxes 1, 2, 3, and 5 from an SSTB that may qualify as qualified items for purposes of the section 199A(a) deduction. Use Form 8995 or 8995-A to determine your section 199A(a) deduction.

 

Box 13. If this box is checked, the information reported to you is from a specified agricultural or horticultural cooperative, as defined in section 199A(g)(4)(A).

• Where do I enter Form 1099-PATR? (Read carefully to report on your Schedule F)
• @mack76a