K1 Form showing 0 for line 14C. Do I select Nonfarm Optional Method?

[idangold]

K1 Form showing 0 for line 14C. So I entered it under line 14 as "C" and "0". Do I then select Nonfarm Optional Method? I'm confused as to when it's allowed as it says "you can only use it 5 times and only if 2 of the last 3 years you earned $400 or more". I am currently on my 3rd year of developing my product and so my line 1 has been negative so far with only a minor income amount last year of $500. For what it's worth, I am not in the farm business. 

[ErnieS0]

The nonfarm optional method allows you to pay self-employment tax when you are not required to. 

If you have $0 income, your self-employment tax would be $0 so using the non-farm optional method will not change anything.

I am confused by your post. You say Schedule K-1 line 1 is a loss and line 14 is $0, so I don't understand where the $500 is coming from as it doesn't seem to be reflected on your Schedule K-1.

[idangold]

@ErnieS0 it is indicating “$0” as it should (the $500 was 2020 year - I just gave all details I could think of). I was also referring to the the rule where you need to have income of $400 or more in the 2 out of the last 3 years for the no farm method to be used. Also there was something about being able to use it only 5 times.  Also this is coming from a partnership so not technically “self-employed” per se. All that being said, what should I do? Leave “0” as “C” on line 14 and choose non farm or farm method? Or just delete/ignore the “0” and “C” completely (though I feel like that’s wrong). Thanks. 

[rlottsman]

Hi, Line 14C says "See Partner Instructions" so are you an actual Partner is this LLC?  We are usually at the partnership level, so this line would not apply to us.  Also, whenever a 0 is shown, don't enter these because they are basically 'blank."  If you enter a 0, the program will look for supporting figures.  Hope this is helpful.

[idangold]

Hi. Yes I’m an actual partner. So basically the second option? I.e ignore it and not enter “C” or “0” for it as the K1 and K1P show?

[rlottsman]

As you are an actual partner, see the Partner's Instructions, as I have only ever been in the partnership position.  After many years using Turbo Tax, I have learned that when one of my categories shows a "0" I don't enter anything into the K-1 because it turns into an error/incomplete entry at the final review.  I am not certain about your situation as a partner and apologize if I'm giving you bad or erroneous information.   You might ask one of the other partners?  Sorry, guess I'm no help at all.    

[idangold]

@rlottsman it’s ok I appreciate your time. Hopefully some of the experts around here can help clear this up. 

[rlottsman]

Perfect, thanks. RLO

[RobertB4444]

@idangold  You don't have a farm so use the non-farm method.  And @rlottsman is absolutely right - ignore any boxes that have zero or are blank and only enter information from boxes on your K-1 that have actual numbers in them.

[idangold]

@RobertB4444 I see ok. Will do. I was always wondering if I should enter nothing for “0’s”. Now I know the answer. I think this will fix this as I did try that route too and then it ignored that question. Thanks.