How to enter K-1 Box 11 code A - nonpassive rental income?

[mellynlee]

How do I enter K-1 Box 11, code A in TurboTax?

On the 'Enter Box 11 Info' page, I enter:

code A - Other portfolio income (loss), and the amount 

Next it shows:

Enter Code A Detail

Fill in any of the following details regarding the $6 you entered on box 11, for Code A.

Income or Loss from REMIC   Excess Inclusion from REMIC   Section 212 Expense from REMIC   Other Portfolio Income (Loss) to be Reported on Schedule E, Page 2   I Have Another Description Item

Under Partner Filing Instructions, my K-1 Details for 'Other Portfolio Income, Box 11, Code A:

Description: Nonpassive Rental Income

I was told (from an online TT CPA) to select the above "I have another Description Item" button, and then when TT displays "Other Description Item Below", I was told to just enter:

"Nonpassive Rental Income" and the amount in the table.

However, I just noticed that LAST year, a TT CPA told me to select the box 

Other Portfolio Income (Loss) to be Reported on Schedule E, Page 2

INSTEAD of "I have another Description Item".

I noticed that by doing that, TT generates nonpassive income in Schedule E, line 32.

But, if I declare it as "I have another description item", then nothing is generated for Schedule E.

Which is the correct way and why?

[PatriciaV]

To report nonpassive rental income from Schedule K-1 Box 11 Code A, choose "Other portfolio income (loss) to be reported on Schedule E, page 2." Enter a description and the amount. This choice will report the income on Schedule E, as is appropriate.

The line for "Other Description" would require a manual entry on another form (this is used for portfolio income that is not reported on Schedule E).

Note that the coding for Box 11 has not changed for tax year 2023, although many other box codes were changed. This may explain the conflicting instructions.

[mellynlee]

Thank you for your reply.

I have had half the people agree with you, and the other half (mostly CPAs) tell me to use "Other Description".

I just spoke with another CPA (through TurboTax Live), and she told me that I need to use

"Other Description". She said the "Other Portfolio income (loss) to be reported on Schedule E, page 2" is for PASSIVE income, and not nonpassive.

I'm not sure why I keep getting differing responses, but I'm going with that one (majority rules?).

[PatriciaV]

Your instructions from Schedule K-1 indicate the income from Box 11 Code A is "nonpassive rental income." If you enter this under "Other portfolio income to be reported on Sch E page 2," the amount will appear under "Nonpassive Income and Loss" on Schedule E page 2 Part II Line 28, column (i) Loss K-1 or (k) Income K-1.

This result is the reason to enter the amount in this way.