Problem with Trust K1 that includes Section 199A Dividends from REIT ETFs

[marthamcmillen]

I am having the same problem. I have the dividends and no answers for the business. I entered the K1 line 14 with the dividend amount and am having to answer all sorts of questions that don't apply. Help

[eneranch]

I am also having this issue; Sch 14 (Form 1041) Line 14, Code I* STM; entered that data into the proper place in TT

next 2 questions did not apply, then got this

Contacted the Accountant that handles the Trust & she assures me that "This is not from a business. It is from 199A qualified dividends from the broker. Per line 5 of 1099-Div. You should not have to enter a business name or EIN. 

All I can tell you is that that the QBI dividends need to end up on Form 8995 line 6. The best I can advise you is to play around with the inputs until you get the result on the form."

I've tried manipulating the Forms, including using a fictitious name & EIN number, and it still will not populate Form 8995 Line 6.

[Anonymous_]

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@eneranch wrote:

I've tried manipulating the Forms, including using a fictitious name & EIN number, and it still will not populate Form 8995 Line 6.

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I believe you will have to wait for TurboTax to correct the issue. Otherwise, the manipulation can be accomplished by adding a Form 1099-DIV and inputting the name of the trust and the 199A figure on Line 5 (although I would not recommend doing so at this point).

[eneranch]

I had a 2+ hour session with TT yesterday, they are aware of the problem & several deficiencies within the Software (Desktop).

I was told a fix was expected today (3/6/2020), but the Update this morning didn't correct the problem.

I was also told I would be placed on an Email Notification List and should receive something once they have corrected the problems.

[jimboaz]

I had a program update this morning and it has not fixed the problem. 

I also tried to read the release notes and run into the same problem of the website being moved. Sad. 

[TMS17]

Is there an estimated timeline on when the issue will be resolved?  Can we receive an email when it is fixed?  Thanks!

[anothertaxpayer47]

I am experiencing a problem identical to that reported here previously.  I have a trust reporting 199A dividends from a brokerage statement.  This shows up on my K-1 package as Section 199A Dividends on Statement A-QBI Pass-through Entity Reporting.  I cannot get my downloaded version of Turbotax to recognize this entry properly.  Form 8995 shows $0.

[jimboaz]

I just went through the trouble of trying to talk to a live TT person. 

She said for the business name and EID to use the trust name and the trust EID. She was getting that information from one of her experts. I questioned it because of the earlier posts, but I tried it. When I entered them, then I got a new screen with had REIT dividends as an option. I don't think I got that before, although I may never had tired since it doesn't make sense. But I'm going with it. 

[eneranch]

Yes, we tried all of that, not to mention overriding inputs into the QBI Deduction Summary so the numbers in the Form 8995 Line 6 would Match what the K-1 said & in the end I was informed that it "may" work but I would have to file a Paper Copy because the Override created a permanent Error and voided the chance to E-file. I do not wish to file something with the IRS that "may" work, I will wait until TT has fixed their defective Software.

If you choose to go forward, I wish you well.

[renogeno]

Check Line 6 on the 8895..........that's where it should show up, but it doesn't.

[Anonymous_]

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@jimboaz wrote:

...I got a new screen with had REIT dividends as an option. I don't think I got that before, although I may never had tired since it doesn't make sense. But I'm going with it. 

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That still will not get the REIT dividends to Form 8995; it may only clear the error flag. 

Thus, you can either wait for a software update or use the procedure I outlined in my post above.

[ColetteBurrus]

The support person that I spoke with wouldn't give me an estimated date when the fix would be available.  I just installed the latest TurboTax update, and it's still not propagating the data correctly. They're supposed to contact me when the fix is available, so when I hear anything from support, I will post the information to this discussion group.

[jimboaz]

First off, I'm using the Deluxe desktop Windows version. Also I have two trusts with K-1s and a mutual fund REIT in both. 

My Form 8995 is populated, including Line 6, a result on Line 15 and the carry to 1040 Line 10. I also have a QBI Component wks for each trust and a QBI Deduction Summary wks. It seems to be working for me. 

BUT, the one thing I don't understand is the total of the REIT Income on Line 6 of form 8995 is less than the sum of the two numbers I entered on the K-1 by about 11%. I can't go to the data  source of Line 6. 

I'm not in a big hurry to file so I'll see what develops. 

[MaxG]

Spoke with the IRS after waiting for an hour on hold.  The K-1 REIT Dividends are to be treated as exactly that…..REIT Dividends, not PTP or QBI if for beneficiary of a Trust/Estate not involving business income.  When entered they must propagate to forms 8995 or 8995-A, respectively, for the optimal deduction.  She did not think much of putting the Trust name and EIN as the PTP if our Trust/Estate income is NOT a business or PTP, merely pass thru income.  She said TT needs to fix this with a software update if manually overriding would prevent an e-file.  She questioned that, as well, and asked if I knew if anyone had manually overridden and corrected forms 8995/8995-A and tried to e-file.  I do not nor have tried to e-file with a manual correction.  Has anyone tried to e-file with an error message?  I also ran by her the suggestion to add an additional DIV statement and she expressed concern that that might flag the return by not matching 1099-divs.  Thoughts?

[ReinaK]

I'm having similar issues with Turbotax Deluxe.

I have section 199A dividends from various ETFs reported in my K-1. After entering the section 199A dividends for Box 14, it asks me to "Enter the category of income shown on box 14." I'm not sure if this is specifically tied to the 199A dividends or not, but regardless, I select "Passive Category." After a couple more questions unrelated to the 199A dividends, it asks me the following:

Name and employer ID number for the business

You reported Section 199A income in box 14 of this K-1. Section 199A income reported on a form 1041 Schedule K-1 generally comes from a business within the trust or estate that has it's (sic) own name and EIN separate from the name and EIN of the trust or estate. Enter the name and employer ID number ... for the business that generated this income.

As others have already mentioned, this is an inappropriate question because the income did not come from a business within the trust, and there seems to be no way to avoid this question without entering false information to satisfy the form requirements.

If I enter the trust name and EIN (again, this is false information), the next step allows me to enter the portion of the 199A amount that came from REITs. However, this amount is never added to Form 8995A (line 28). There is an amount on that line, but it's from other 1099-DIV Section 199A income.

In the Qualified Business Income Deduction Summary step, it even lists the trust with $0 QBI deduction, alongside the 20% REIT income deduction from the other 1099-DIVs. But this process is probably not worth pursuing anyway, since we should not be entering the trust name and EIN as a QBI "trade or business" in the first place.

Has anyone heard any updates or communication from them about this?