What do I enter for "Gross receipts for section 448 (c)"?

[idangold]

After nearly completing my return, Turbo Tax Business discovered a single error. 

The error took me to Form 1065 P4-5, Under line-item 20E, it wanted me to enter a value for "AG - Gross receipts for section 448 (c)". What do I enter? I never had to do this before. Thank you. 

[PatriciaV · Accepted solution]

TurboTax should calculate this number for you. Generally, you can enter the number that appears on Form 1065 Line 1a Gross receipts or sales.

For more info see: IRS Instructions for Form 1065 (2021).

[Edited 3/3/2020 | 6:50 AM PST]

[idangold]

So since this is only "Gross receipts or sales" and my company did not sell anything during 2021 (as we're currently in development mode only), then I can leave this as 0 (which is what TurboTax did input in line 1a as well)? And also remove "AG" from line 20E?

Thank you!

[ThomasM125]

Section 448 refers to qualifying to use the cash method of accounting, which can be limited based on your gross receipts. You can leave the AG abbreviation there, and just enter -0- for the gross receipts.

[idangold]

Ok I’ll do that. Thank you both. 

[kyla5]

Question - I'm using TurboTax Business for my partnership and it's not populating the amount for Box 20 AG. I also can't edit the amount on the supplemental worksheet. Am I missing something? We definitely had gross receipts and the total from the last 3 years is less than 25m so I want to be sure I'm reporting if I should be.

[PatriciaV]

Reporting Gross Receipts for Section 448 on Form 1065 Box 20 Code AG is optional for partnerships with current year gross receipts less than or equal to $5 million (per IRS Instructions for Form 1065 (2021)).

@kyla5

[kyla5]

Thank you so much! Everything I googled about K-1s referenced "less than 25m" - I don't know how I missed the instructions for the 1065. 

[MoniqueLO_]

Thank you for the update! We are glad you were able to get your issue resolved. 

@kyla5

[andyt2]

I'm having the same issue. Turbotax is not calculating/prefilling this number and then throwing it up as an error, is this an issue with the software?

[convertibledreaming]

Help!  Same issue.  But last year TTax filled out line 20 on my K1 as $108k even though line 1a on 1065 was $190k.  I never have returns or allowances.  How would the number be anything other than line 1 on the 1065?  This year it's my only "error" and it asks me to manually enter AG  GROSS RECEIPTS FOR SECTION 448(C) .   Help please.   

@PatriciaV 

@ThomasM125 

[convertibledreaming]

@andyt2  Did you end up finding a solution?  I have the same problem.

[idangold]

See @PatriciaV ’s response up above. That’s what I followed. 

[convertibledreaming]

You're fine with it being an unexplainable formula (I discovered later that it's  income minus returns and allowances) yet..... it's "optional" to report it?  Otherwise, "0"?  This is the answer?!!!! A big enough error that it prohibits submission, yet it's not  actually an error at all?  This makes no sense.  It was not this way last year.  The number was calculated by TT to be about 15% LESS than the gross total yet I've NEVER had any customer returns.

[idangold]

It’s not an error in my case I guess. The number I had in 1a made sense.