Qualified Business Income Deduction

[pg1269]

I have K-1 income that meets all of the criteria for the qualified business income deduction. I am getting an error message that states "Box 20 Code Z has been selected but no Section 199A income has been entered on Statement A. I have entered all of the information properly on all of the screens in the K-1 section and an amount does show up in blue on the worksheet. However, form 8995 is not pulling the amount from the worksheet and the deduction shows up as zero on the 1040. 

[DaveF1006]

It depends. You need to do a little bit of work at this point. There is some information you need to enter in Box 20 that is contained in the supplementary statement that came with the form. Look on those statements to see if there is a reference to Box 20 and data to enter. This Box determines if you are able or not able to claim QBI.

1. Go to federal>wages and income>Business Investment and Estate/Trust income>Schedule K1
2. Enter information on your form in accordance with the questions asked.  
3. After entering the information regarding your K-1.  Enter information if any in Boxes 1,2, and 3. Check the box that indicates there are amounts in more than Boxes 1,2, &3.
4. Check Box 20 and press continue.
5. Now enter the numbers on the form, when you enter information in Box 20
6. Pick code Z from the drop down. Leave the amount blank. If there is a 0, remove it. Turbo Tax will determine that amount from the questions that follow. press continue.
7. Continue to answer the questions with the answers from the supplementary statements.Be sure to mention that your investment is at risk.
8. And then continue through the questions. As I mentioned above, some of the information required to complete section 20 is mentioned in the supplemental statements that came with the K-1.
9. If after doing this and if the Box still shows a 0 in the end, remove it so you can efile your return.

[pg1269]

Thanks Dave. I did all those steps and still got a 0 on line 15 of the 1040. What did work is when I added my Section 199A Income as an other adjustment on the adjustments to Statement A screen.