S-Corp Loss - Basis Limitations on 1040

Forum|Forum|3 months ago
March 17, 2026
2 replies
11 views

Working on a 1040 return, and imported the K-1 which has a $60k loss. The loss should roll forward as it is not allowed in the current year due to basis limitations.

The software is not handling correctly and it is allowing a loss in the current year.

What is the best way to handle so that:

1. The loss is not allowed

2. It is rolled forward and tracked properly in the software moving forward

ProSeries Professional

dascpa

Level 11

Is Some Investment Not At Risk checked off?

Is 6198 filled out?

If S corp is 7203 filled out?

T

TaxGuyBill

Level 15

@dascpa wrote:

Is Some Investment Not At Risk checked off?

Is 6198 filled out?

Those do not apply for Basis limits, although they may be able to be used as worksheets to help figure out the correct amounts.

T

TaxGuyBill

Level 15

ProSeries does not limit due to Basis. You need to manually do it.

Only enter the allowable loss on the K-1 worksheet. Then manually change the 7203 to reflect the full loss that is on the actual K-1.

Next year (or whenever Basis is restored), enter a second K-1 worksheet called "PYA" to enter the then-allowable losses. And manually change the 7203 to not reflect this second K-1.

It won't automatically roll over, so you need to keep track of it some other way. Maybe a "note" in the program, or open up the line-worksheet to show some information. Or a post-it note if you have paper-files.

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