Question

K-1 part 111 not functioning correctly

Forum|Forum|2 years ago
March 11, 2024
1 reply
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With Activity box for rental checked and no entry for line 1 ordinary income, when I uncheck material participation, taxes due climbs by thousands.

I understand what should be happening for material participation for line 2, but not when checking and unchecking a zero amount on line 1 when "activity" should not be linking to line 1 anyway.

TurboTax Home & Biz Windows

PatriciaV

If you have no ordinary business income on Line 1 of Schedule K-1, do not check any boxes under that line. For Rental Income, check only the boxes under Line 2. Also, do not enter a zero on any income line.

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W

WilHen02Author

To better phrase my problem. We do qualify as real Estate Professionals with an LLC for our rental units. I have not been able to get TT H& B to not treat the current loss as passive income, which limits the loss to 25K. I can do it by the previously described hack method. I am coming to the conclusion that TT has no method of processing Real Estate Professional rental losses. Not within E nor within K-1s. The K-1 does not have a drop down for R.E.P.s where the Active and Passive dropdowns are shown on the K-1.

I would expect the required statement could be attached as a scanned attachment were there a way to get TT to correctly treat the loss as an active loss.