K-1 Question

[milleda5]

I received a K-1 form from my grandmother's estate. In box 5 there is an amount for other portfolio and nonbusiness income. Then in box 14 - Other information - there is the letter H with this same amount as a negative. When I fill out my K-1 information in turbo tax, it seems that I'm being taxed on the amount in box 5, but it isn't factoring the offsetting negative amount in box 14. As these amounts offset, I was thinking there wouldn't be an impact on my income taxes.

[fanfare]

Wishful thinking.

Box 14-H is not going to offset box 5 dollar for dollar.

So you'll be paying tax on that.

[Anonymous_ · Accepted solution]

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@milleda5 wrote:

...I'm being taxed on the amount in box 5, but it isn't factoring the offsetting negative amount in box 14...

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The negative amount in Box 14(H) only offsets the amount in Box 5 if you are subject to the NIIT (net investment income tax) on Form 8960.

If you are not subject to the NIIT, Form 8960 is not generated and there is no offset.