Form 8958 (Community Property allocation) - do I need to list separate property too?

[si29xnm]

We are unmarried registered domestic partners in California, so we have to use Form 8958 to split community property income between the two of us and file Federal tax returns as two singles.

We have some 1099’s from pre-RDP accounts that are still separate property. Do I need to list those 1099’s on Form 8958 as well and just put 100% of total amount in Col. A in Col. B for that entry?

[JoannaB2]

The federal government does not recognize domestic partners as married individuals, therefore, they continue to file unmarried individuals on their federal return.  You may use form 8958 to allocate your income for computation only,  You have to enter the i/2 of the community property income only as other income on line 8 of 1040 from Schedule 1, line 9 and enter the description " filing RDP joint in California return . On form 8958, allocate income (wages, interests, dividends and many more), self-employment taxes only, and more  

See. form 8958, link  for instruction

[si29xnm]

When I add the Community Property adjustment amount, TurboTax does put that amount in line 8 of Form 1040 as you say. In my example, that is -$41,479. But then, TurboTax puts "Other income" for that amount in Section 12 of Form 8958 ("Other items such as: Social Security Benefits...") automatically, and I cannot delete it. Is this really the right way of doing it? The entire point of Form 8958 is to show IRS how we split our income between the two of us, so why would I put the community property adjustment amount as a line item?

[JoannaB2]

Yes, you need to use form 8958 to allocate al income.  In turbo Tax, under Community Property Income,  cilck yes on " Do you have any community properry adjustments on community property income to report for 2020.  You will be asked to enter "Community Property addition/adjustment " and "Cmmunity Property Subtraction/adjustment.  

See, how do i prepare an RDP return, link

[BFWP33]

Did you find an answer to this question anywhere? It's puzzling to me why the TurboTax software does this, but I've noticed the same thing -- i.e. that line 12 of Form 8958 shows the net community property adjustment as "Other Income". It seems totally counter to the purpose of Form 8958.

[KrisD15]

Let's say one taxpayer had 30,000 in wages and is splitting that 50/50. 

Their 1040 will have the 30,000 on their 1040 as wages and also the -15,000 as other income to offset the adjustment. 

Form 8958 reports the -15,000 on line 12 so that the IRS can match this entry. 

[BFWP33]

Thanks KrisD15. And this "Other Income" amount (-15,000, in your example) shown on Line 12 from Form 8958 should presumably match the "Negative Community Property Adjust." that Turbotax inserts on Line 8 of Schedule 1?

[KrisD15]

Yes, and the spouse should have a 15,000 other income on their return and a positive 15,000 on their 8958 line 12. 

The amount should flow to the 1040 line 8 as well. 

[BFWP33]

Thanks, KrisD15. You da man!!!

[gee0113]

Just to be clear on the point about Federal gov't not recognizing as married.. that should have said does not recognize "unmarried" domestic partners as married on tax return.  If legally married then yes, they would file married/joint or married/separate.  See article below from IRS.

https://www.irs.gov/pub/irs-utl/OC-SamesexmarriagesnowrecognizedforfederaltaxpurposesFINAL.pdf