To enter the other deductions from Schedule K-1 (Form 1120-S) in TaxSlayer ProWeb, from the Federal Section of the tax return (Form 1040) select:
- Income
- Other Income
- K-1 Earnings
- Schedule K-1 Form 1120-S - Select the pencil icon to edit the K-1.
- Other Deductions
11 - Section 179 Deduction
$The amount of Section 179 deduction the taxpayer is allowed to deduct is subject to the dollar limitation and the business income limitation. You will need to calculate the amount the taxpayer is allowed to deduct, and if it's less than the amount on the K-1 enter only the allowed amount.
The amount entered will flow to Schedule E line 28 column (j).
12 - Other Deductions
12A - Cash Contributions 60%
Enter the amount, and it will flow to Schedule A line 11 subject to the 60% AGI limitation.
12B - Cash Contributions 30%
Enter the amount, and it will flow to Schedule A line 11 subject to the 30% AGI limitation.
12C - Noncash contributions (50%)
The amount entered is for reference purposes only and not posted to Schedule A. Enter this in Schedule A (Itemized Deductions) under Gifts to Charity. Where you make the entry depends on its amount:
- If $500 or less, under Non-Cash Gifts to Charity enter the amount in the field "Non-Cash Contributions Less Than or Equal to $500".
- If more than $500, enter the information about the donation under the menu Non-Cash Donations (more than $500) to complete Form 8283 for the donation. There should be information accompanying the K-1 giving the details needed to complete Form 8283.
Additionally, enter information about the S corp under Non-Cash Contributions from Pass Through Entities.
12D - Noncash contributions (30%)
The amount entered is for reference purposes only and not posted to Schedule A. Enter this in Schedule A (Itemized Deductions) under Gifts to Charity. Where you make the entry depends on its amount:
- If $500 or less, under Non-Cash Gifts to Charity enter the amount in the field "Non-Cash Contributions Less Than or Equal to $500".
- If more than $500, enter the information about the donation under the menu Non-Cash Donations (more than $500) to complete Form 8283 for the donation. There should be information accompanying the K-1 giving the details needed to complete Form 8283.
You also need to make two additional entries:
- Under Non-Cash Contributions from Pass Through Entities, enter information about the S corp.
- Under Limitation on Charitable Contributions Deduction, enter the amount in the field "How much of your total contributions were gifts (excluding capital gain property) donated to organizations that were not qualifying 50% Limit Organizations?".
12E - Capital gain property to a 50% limit organization (30%)
The amount entered is for reference purposes only and not posted to Schedule A. Enter this in Schedule A (Itemized Deductions) under Gifts to Charity. Where you make the entry depends on its amount:
- If $500 or less, under Non-Cash Gifts to Charity enter the amount in the field "Non-Cash Contributions Less Than or Equal to $500".
- If more than $500, enter the information about the donation under the menu Non-Cash Donations (more than $500) to complete Form 8283 for the donation. There should be information accompanying the K-1 giving the details needed to complete Form 8283.
You also need to make two additional entries:
- Under Non-Cash Contributions from Pass Through Entities, enter information about the S corp.
- Under Limitation on Charitable Contributions Deduction, enter the amount in the field "How much of your total contributions were gifts of capital gain property to organizations that were not qualifying 50% Limit Organizations?".
12F - Capital gain property (20%)
The amount entered is for reference purposes only and not posted to Schedule A. Enter this in Schedule A (Itemized Deductions) under Gifts to Charity. Where you make the entry depends on its amount:
- If $500 or less, under Non-Cash Gifts to Charity enter the amount in the field "Non-Cash Contributions Less Than or Equal to $500".
- If more than $500, enter the information about the donation under the menu Non-Cash Donations (more than $500) to complete Form 8283 for the donation. There should be information accompanying the K-1 giving the details needed to complete Form 8283.
You also need to make two additional entries:
- Under Non-Cash Contributions from Pass Through Entities, enter information about the S corp.
- Under Limitation on Charitable Contributions Deduction, enter the amount in the field "How much of your total contributions were gifts of capital gain property to organizations that were not qualifying 50% Limit Organizations?".
12G1 - Cash contributions (100%)
The amount entered is for reference purposes only and not posted to Schedule A. See 12G2 below.
12G2 - Noncash contributions (100%)
The amount entered is for reference purposes only and not posted to Schedule A. This amount represents the taxpayer's share of qualified conservation contributions. A qualified conservation contribution is a contribution of a qualified real property interest to a qualified organization to be used only for conservation purposes. (This contribution is not included in the amount reported in Box 12 code C, if any.)
If the taxpayer is a farmer or rancher, they qualify for a 100% AGI limitation for this contribution, otherwise the deduction for this contribution is subject to a 50% AGI limitation.
Use the information supplied by the S corporation about the contribution to determine whether to enter it as a cash or noncash contribution.
In addition to the above entry, three additional entries need to be made in Schedule A (Itemized Deductions):
- If more than $500, enter the information about the donation under the menu Non-Cash Donations (more than $500) to complete Form 8283 for the donation. The corporation should have provided a copy of its Form 8283 for this contribution giving the details needed to complete Form 8283.
- Under Non-Cash Contributions from Pass Through Entities, enter information about the S corp.
- Under Limitation on Charitable Contributions Deduction, enter the amount in either "Qualified Conservation Contributions Subject to 100% AGI" (if the taxpayer is a farmer) or "Any Qualified Conservation Contributions Not Subject to 100% AGI" (if the taxpayer is not a farmer).
12H - Investment Interest Expense
Enter the amount, and it will flow to line 1 of Form 4952, Investment Interest Expense Deduction. Form 4952 will be included in the return if an interest deduction calculates.
12I - Deductions to Royalty Income
Enter the amount, and it will flow to Schedule E Part I for the royalty income in Box 6 on this K-1.
12J - Section 59E(2) Expenditures
The amount entered here is for reference purposes only and not posted to any form.
The K-1 should have an attached statement providing details about the expenditures, identifying the property for which the expenditures were paid or incurred and listing the amount of each type, if there is more than one type of expenditure.
Rather than deduct these expenditures in full in the current year, under section 59(e) the taxpayer can elect to amortize their pro rata share of the expenditures over 10 years (or 3 years for circulation expenditures). The deduction is taken beginning with the tax year in which the expenditures were made (or for intangible drilling and development costs, over the 60-month period beginning with the month in which such costs were paid or incurred).
If the taxpayer chooses to deduct these expenditures in full in the current year, they will be treated as adjustments or tax preference items for AMT purposes. Otherwise, if the taxpayer elects to amortize these expenditures rather than deduct the full amount in the current year, they aren't treated as adjustments or tax preference items.
If the taxpayer chooses not to make the election, you will need to make two entries:
- Create a second K-1 entry for this S corporation, and enter the amount of the deduction as a negative in Box 1. If the taxpayer didn't materially participate in the S corporation activity, in Part I check the box for "This K-1 is from a passive entity".
- In the Alternative Minimum Tax menu (Form 6251) under Other Taxes, enter the difference between the amount allowed for AMT purposes and the amount allowed for regular tax purposes. (Research and experimental costs deducted under section 174(a) for regular tax purposes generally must be amortized for AMT purposes over 10 years beginning with the year the costs were paid or incurred.)
If the taxpayer chooses to make the election under section 59(e) to amortize the expenditures, create a second K-1 entry for this S corporation and enter this year's amount of the amortized deduction as a negative in Box 1. If the taxpayer didn't materially participate in the S corporation activity, in Part I check the box for "This K-1 is from a passive entity".
12L - Deductions - Portfolio income (other)
The amount entered will flow to Schedule A as an Other Itemized Deduction.
12M - Preproductive period expenses
The amount entered is for reference purposes only and not posted to any form. The taxpayer may be able to deduct preproductive period expenses in the current year, or they may need to capitalize them under section 263A. See Pub. 225, Farmer’s Tax Guide, and Regulations section 1.263A-4 for details.
12O - Reforestation expense deduction
The amount entered is for reference purposes only and not posted to any form. The corporation should have provided a statement that describes the qualified timber property for these reforestation expenses. The taxpayer's expense deduction is limited to $10,000 ($5,000 if married filing separately) for each qualified timber
property, including the taxpayer's share of the corporation’s expense and any reforestation expenses they paid separately or incurred during the tax year.
Create a second K-1 entry for this S corporation, and enter the amount of the deduction as a negative in Box 1. If the taxpayer didn't materially participate in the S corporation activity, in Part I check the box for "This K-1 is from a passive entity".
12W - Soil and water conservation
The amount entered is for reference purposes only and not posted to any form. The amount deductible under IRC section 175(a) for any taxable year can't exceed 25 percent of the gross income derived from farming during the taxable year. Any excess not deductible in the current year can be carried forward and deducted along with the expenses paid or incurred in subsequent years, subject to the same 25% limitation.
Create a second K-1 entry for this S corporation, and enter the amount of the deduction as a negative in Box 1. If the taxpayer didn't materially participate in the S corporation activity, in Part I check the box for "This K-1 is from a passive entity".
12X - Film, television, and theatrical production expenditures
The amount entered is for reference purposes only and not posted to any form. The corporation should have provided a statement describing the film, television, live theatrical, or qualified sound recording production generating these expenses. See section 181(a)(2) for dollar limitations that may apply.
Note that section 181 expired at the end of 2025 and thus applies to expenditures incurred in 2025 or prior.
Create a second K-1 entry for this S corporation, and enter the amount of the deduction as a negative in Box 1. If the taxpayer didn't materially participate in the S corporation activity, in Part I check the box for "This K-1 is from a passive entity".
12Y - Expenditures for removal of barriers
The amount entered is for reference purposes only and not posted to any form. This amount represents expenditures for the removal of architectural and transportation barriers to the elderly and disabled that the corporation elected to treat as a current expense. The deductions are limited by section 190(c) to $15,000 per
year from all sources.
Create a second K-1 entry for this S corporation, and enter the amount of the deduction as a negative in Box 1. If the taxpayer didn't materially participate in the S corporation activity, in Part I check the box for "This K-1 is from a passive entity".
12Z - Itemized deductions
The amount entered is for reference purposes only and not posted to any form. The K-1 should have a statement attached explaining this deduction. Report it in the appropriate place on Schedule A.
12AA - Contributions to a capital construction fund (CCF)
The amount entered is for reference purposes only and not posted to any form. The IRS instruction is to subtract the amount from the taxable income on Form 1040 line 15, and in the margin to the left of line 15 enter “CCF” and the amount of the deduction. As this is a manual correction of Form 1040, a Schedule K-1 with an amount in Box 12 with code AA cannot be completed in TaxSlayer ProWeb.
12AB - Penalty on early withdrawal of savings
The amount entered is for reference purposes only and not posted to any form. Enter this amount in the Adjustments menu under Penalty on Early Withdrawal of Savings or Certificate of Deposit (CD).
12AC - Interest expense allocated to debt-financed distributions
The amount entered is for reference purposes only and not posted to any form. Where this amount is to be entered in the tax return depends on how the taxpayer used the distributed debt proceeds.
If the distributed debt proceeds were used in a trade or business, create a second K-1 entry for this S corporation with the S corporation's name plus "interest expense", and enter the amount of the deduction as a negative in Box 1. If the taxpayer didn't materially participate in the S corporation activity, in Part I check the box for "This K-1 is from a passive entity".
If the distributed debt proceeds were used in an investment activity, report the interest expense on Form 4952.
If the distributed debt proceeds were used for personal reasons, the interest expense is not deductible.
12ZZ - Other deductions
The amount entered is for reference purposes only and not posted to any form. The K-1 should have a statement attached explaining the deduction(s). If deductible, report it in the appropriate form or schedule.
Note: This is a guide on entering the Deduction items from Schedule K-1 (Form 1120-S) into TaxSlayer ProWeb. This is not intended as tax advice.
Additional Information:
Shareholder’s Instructions for Schedule K-1 (Form 1120S)
ProWeb: Form 1040 - Schedule K-1 (Form 1120S) - Overview
ProWeb: Form 1040 - Schedule K-1 (Form 1120S) - Entity Information
ProWeb: Form 1040 - Schedule K-1 (Form 1120S) - Income
ProWeb: Form 1040 - Schedule K-1 (Form 1120S) - Credit and Other Information