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Returning Member
posted Sep 26, 2020 4:28:18 PM

K-1, Box 13, Code W basically just says "FROM PASSTHROUGH"

I have three K-1's from passive activity investments that all have Box 13, Code W amounts and the descriptions are kind of similar:

 

1. "From pass-through entities"

2. "OTHER DEDUCTIONS FROM PASSTHROUGH ENTITIES"

3. "OTHER DEDUCTIONS FROM SCHEDULE OF ACTIVITIES"

That's all they say. They don't indicate whether they're portfolio deductions or business deductions.

 

Does anyone know whether this is portfolio deductions or if it's business deductions?

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1 Replies
Level 3
Jan 19, 2021 5:37:28 PM

The firm who prepared the Partner's K-1 should have included a description of what the deductions are and instructions on how to report the deductions on the partner's individual return. See the Partners instructions for Schedule K-1 for a comprehensive list of deductions that may be reported in box 13 with code W.

If the firm who prepared the partner's K-1 did not provide a description or instructions on how to report box 13 code W:

  1. Go to Screen 20, Passthrough K-1's.
  2. Select Partnership from the left navigation panel.
  3. Scroll down to the Separately Stated Income and Deductions section.
    • To report the deduction as passive:
    1. Locate the First Passive Item subsection.
    2. Hold down Ctrl+E in Other (Ctrl+E).
    3. Enter the Description.
    4. Enter the Amount as a negative number.
    5. Click OK.
       

       

      If the loss is allowed after passive limitations are applied the entry will flow to the Schedule E, page 2, Line 28 column (f), "Passive loss allowed (attach Form 8582 if required)".
    • To report the deduction as nonpassive:
    1. Hold down Ctrl+E in Other nonpassive items (Ctrl+E).
    2. Enter the Description.
    3. Enter the Amount as a negative number.
    4. Click OK.
       

       

      This entry will flow to the Schedule E, page 2, Line 28 column (h) "Nonpassive loss from Schedule K-1".

If the partnership provided details on the box 13, code W amount, review the Where do I enter... link found in the Line 13 - Other Deductions section heading of screen 20.1.

 

 

This will open the Lacerte Help Center where you can click Line 13W - Oth

r Deductions for more input details.

 

 

The detailed input for this line has instructions regarding where this input may belong. For box 13W amounts that are not specifically listed here, use the Partners instructions for Schedule K-1 to determine where the item should be reported on the partner's 1040.