I am a shareholder in an S Corporation and have received a schedule K-1 from the company. I am using TurboTax Premier 2022, and am at the step for filling out form 7203's smart worksheet. When I get to this form, TurboTax already has an entry in part E which I did not enter (with the description "Line I, line 3m: Other items that increase stock basis") with a description "INCOME ITEMS" and a positive amount. I do not know how it is arriving at the amount that is displayed and the amount does not match any items in the K-1 form I have received and entered earlier. When I right click on either the description or the amount, the "Data Source" is grayed out. Where does Turbotax get this amount from?
Does the number in the Smart Worksheet also appear on Part I Line 3m (the section below the worksheet)? It may be a total or a number from the supplemental information provided with the K-1.
You could try deleting the K-1 then re-enter it while keeping track of changes on Form 7203. This might reveal which entry creates the number on Line 3m.
Hi, you wrote: Does the number in the Smart Worksheet also appear on Part I Line 3m (the section below the worksheet)?
Answer is: Yes and again the data source is grayed out.
You wrote: It may be a total or a number from the supplemental information provided with the K-1.
My comment: There is no data in K-1 that matches this number, and there is very little other data in K-1, making it unlikely to be a total. K-1 is reporting a loss. Just to check, I increased the K-1 loss amount significantly but it did not change the entry in form 7203. Similarly, I changed the reported loss to a positive number, and again no change!
We are unable to reproduce the experience you have seen. It would be helpful to have a TurboTax ".tax2022" file to test further.
If you would be willing to send us a “diagnostic” file that has your “numbers” but not your personal information, please follow these instructions:
Open your return in TurboTax for Desktop and go to Online in the TurboTax header.
We will then be able to see the same experience you are having. If we are able to determine the cause, we'll reply here and provide you with a resolution.
If you're using TurboTax Online: Open your return, go to the black panel on the left side of your program and select Tax Tools.
I am willing to do this, but only if what I have found out so far does not help:
1) The description and amount are incorrectly being imported from the 2021 tax return. The prior tax return (2021 tax return) correctly had this amount entered in its Form 7203, Part VII - Income items. I think it was my share of the PPP loan that was forgiven (listed as Other tax-exempt income.) But that just belonged to 2021, and should not be duplicated for tax return 2022.
2) This probably is for another division in TurboTax, but the 2022 TurboTax business does not generate a Stockholder Basis Statement as the earlier versions did, or I have not been able to generate one for some reason. It does generate a Shareholder Stock and Debt Basis Limitation worksheet. Perhaps this is by design? However these worksheets (one for each shareholder) do not have any values in the "Stock basis at the beginning of the corporation's tax year" and those fields are all blank. Prior year's tax return did have values for the end of the year which should have been transferred to 2022's beginning of the year.
The combination of the above 2 items create a very confusing situation, and I hope I have correctly figured out what is going on! Let me know if you still want the diagnosis file.
Yes, the old Stockholder Basis worksheet has been replaced, based on IRS rules for S-Corps. If the beginning basis didn't carry over from last year, you can manually enter this on the basis limitation worksheet.
If you are still uncertain about the information on any forms or worksheets, you can post a token to this thread. Be sure to tag me if you do. Or if you have other questions, you can post here or start a new thread.