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Level 2
January 28, 2021

Where to record S corp basis limitation on 1040

  • January 28, 2021
  • 23 replies
  • 121 views

I have a client with a S corp loss, but no basis.  When I enter the K-1 with the loss in the 1040, it populates the loss on Schedule E.  How do I show that there is no basis and get Schedule E to show zero.  Where does the carryover loss show in Proseries?

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    23 replies

    January 28, 2021

    You are supposed to only enter the amount allowed (in your case, $0) and manually carry over any amount to use in future years.  ProSeries is deficient it this regards, and does not  have a proper mechanism to limit losses due to Basis (or to carry over that unused amount).

    Level 5
    March 9, 2021

    TaxGuyBill: If you manually enter only the allowed loss on line 1, should modifications be made to the QBI amounts in Proseries? or any other lines on the K-1 worksheet?  Or is it recommended to only modify line 1 of the K-1 to limit the loss due to basis?

     

    March 9, 2021

    I don't think anything else needs to be changed.