Issue with Box-Y Investment Expenses auto-populated with -ve amount Net Rental Real Estate Loss

Forum|Forum|4 months ago
February 19, 2026
1 reply
3 views

I am preparing a multi-state 1065 return with 100% allocation to Alabama. It has Form 8825 and there is rental real estate loss

I entered a +ve amount into Schedule K other items to avoid the diagnostic Ref#14017 negative amount error

But the system auto populated investment expenses -ve amount into Box Y of Alabama Schedule K-1 and I am unable to get rid of it. That amount exactly equals the net rental real estate loss. This is passive activity income.

I had same loss situation last year and went into input mode and could not see anything different. I do not see in 2024 return that I keyed in anything to other information

Will be grateful for any suggestions.

ProConnect Tax

H

HariSAuthor

Level 3

Coming back here to post that the issue has been resolved.

I called ProConnect Support line and they figured out that the adjustment I did in Schedule M2 to correct an opening balance issue on partner's capital account (book vs tax depn difference) caused the current period loss to populate in Box Y investment expense

Once I cleared that in the M-2 schedule the problem disappeared, I would never have figured it out.

thanks !

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