Form 3800 with an Eligible small business
I’m working with a client whom received a 2022 amended K1 from an scorp that includes a credit for increasing research activities, code M, in box 13. The business is an eligible small business, so in Proseries, I entered the amount on the schedule K-1 S corporation additional information worksheet in the column as a credit for increasing research (ESBC). My issue is that it’s reducing the credit on form 3800, line 13. Here's what Chatgpt told me:
For tax years beginning after 2010, “Eligible Small Business” credits are exempt from the general business credit limitation imposed by Line 11 through Line 17 of Form 3800 — including the 25% excess limit on Line 13 you're asking about.
This was enacted under IRC §38(c)(5).
Am I doing something wrong?
