Level 5

QBI calculation does not match K-1's retirement and self-employed taxes on Schedue SE

Forum|Forum|7 years ago
March 28, 2019
1 reply
11 views

there are discrepancies between QBI worksheet and K-1 amounts.

1. Partner's total retirement $55,000 in K-1. QBI worksheet shows $51,821.

2. Sch SE has $13,582 (1/2 SE tax). QBI worksheet shows $12,797.

Does anyone know the reason for these differences?

Lacerte Tax

This topic has been closed for replies.

itonewbie

Level 15

Interestingly, both numbers are reduced by the same proportion.

Just so that we understand the context of your question correctly, what has the partner's retirement income got to do with QBI from the K-1, supposing this is a 1040 given you also mentioned 1/2 SE tax?

---------------------------------------------------------------------------------Still an AllStar

H

hgtcAuthor

Level 5

sorry, I meant $55,000 for 401k + SEP contribution shown in K-1. Actually, business incomes shown in QBI calculation does not match K-1 incomes in Sch E p2 either. Just can not match the reductions in all Lacert's worksheets for these items: business incomes, self-employed taxes, and self-employed pension.

M

mdambacher

Level 3

The program reduces QBI by 1/2 SE tax deduction and SE pension only by the amount that SE Income is included in QBI. For example, let's say there in a K-1 with $100,000 of ordinary income, $50,000 of guartenteed payments, $150,000 of SE income on line 14 and $100,000 of QBI. This would result in a 1/2 SE tax deduction on Schedule 1, line 27 of $6,870. However, guaranteed payments are not included in QBI. Therefore, the program only uses $100,000 of SE income as allocable to QBI. 100,000 / 150,000 * 6,870 = 4,580. The program reduces QBI by $4,580 and will reduce QBI for the SE pensions by the same ratio.

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