Question

Schedule E in TurboTax does not allow for reflecting limited partner losses

Forum|Forum|3 years ago
April 3, 2023
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Schedule E should allow for reporting partnership losses and income as per the reference below from Turbotax. However, in turbotax desktop application and even online when I select schedule E, it only allows me to select "Rental Property" or "Royalty Property or Payment". There is no selection that allows me to to select a partnership loss. Can you please urgently advise how I can fill in a schedule E from scratch to reflect losses in an investment partnership where I invested as a limited partner in an LLC?

Also, are losses in this situation deductible from W2 income or only against passive gains?

"If you are a partner in a business venture, the partnership will report your share of business income, expenses, gains and losses on a Schedule K-1. If you receive this form, you will need to have it handy when filling out the Schedule E since the amounts you input on Schedule E will mirror those on your K-1."

https://turbotax.intuit.com/tax-tips/rental-property/video-filing-schedule-e-supplemental-income-and-loss/amp/L4H2ZTWRi

TurboTax Home & Biz Windows

AmyC

1. Yes. All the losses are on your K-1. You simply need to enter the k-1 form and the program will generate the Sch E needed.

2. It first goes against long term gain, then short term gain. If there is still a loss, you can claim up to $3,000 against your regular income. The remainder will be a carryover for future years. See How to carryover a business loss from K-1.

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M

mikeynyc123Author

Hi Amy -

Unfortunately this LLC did not provide a form K1, but just a statement of loss with supporting documents in a word file and details on my investment. Is this sufficient for me to fill in a schedule E, and if so, how do I fill in the schedule E for a limited partner (myself) that invested in this real estate fund without going through the K-1 form process?

Also, if one is filing MFJ, does the amount one can claim go up higher than $3000 against regular income in a given year? Is there any way to be able to claim MORE than 3k a year from a loss in an LLC investment as a limited partner against w-2 income? I do see in Schedule E part II there are boxes that say "passive income and loss" and "nonpassive income and loss". Wondering how I can claim the entire amount ~20k into the non passive bucket.

Thanks much!!