To enter the items from Part III of Schedule K-1 (Form 1041) in the individual income tax return in TaxSlayer ProWeb, from the Federal Section of the tax return (Form 1040) select:
- Income
- Other Income
- K-1 Earnings
- Schedule K-1 Form 1041 - Select the pencil icon to edit the K-1.
Part III - Beneficiary's Share of Income,
Deductions, Credits, etc.
1 Interest income
$Interest is portfolio income, and any amount entered here carries to Schedule B.
2a Ordinary dividends
$Dividends are portfolio income, and any amount entered here carries to Schedule B.
2b Qualified dividends
$Dividends are portfolio income, and any amount entered here carries to Schedule B.
3 Net Short-Term Capital Gain(Loss)
$Capital gain/loss is portfolio income, and any short-term gain or loss carries to Schedule D Part I.
4a Net Long-Term Capital Gain(Loss)
$Capital gain/loss is portfolio income, and any long-term gain or loss carries to Schedule D Part II.
4b Collectibles (28%) Gain(Loss)
$Collectibles gain/loss is portfolio income, and any amount entered carries to the 28% Rate Gain Worksheet and from there to Schedule D.
4c Unrecaptured Section 1250 Gain
$Unrecaptured section 120 gain is portfolio income, and any amount entered carries to the Unrecaptured Section 1250 Gain Worksheet and from there to Schedule D.
5 Other portfolio and nonbusiness income
$The amount reported in Box 5 is the beneficiary's distributive share of royalties, annuities, and other income not subject to the passive activity rules. It also includes income in respect of a decedent (IRD) not included in Boxes 1, 2a, 3, 4a, 6, 7, or 8. This amount carries to Schedule E line 33 column (f).
6 Ordinary business income
$This amount is treated as passive, carrying to Schedule E line 33 column (d) if a gain, or column (c) if an allowed loss subject to the passive activity loss rules, carrying from Form 8582. (ProWeb doesn't support treating this amount as nonpassive, either related to a farm or a nonfarm business.)
7 Net rental real estate income
$This amount is treated as passive, carrying to Schedule E line 33 column (d) if a gain or column (c) if an allowed loss. A loss is subject to the passive activity loss rules, carrying from Form 8582. (ProWeb doesn't support treating this amount as nonpassive.)
8 Other rental income
$This amount is treated as passive, carrying to Schedule E line 33 column (d) if a gain or column (c) if an allowed loss. A loss is subject to the passive activity loss rules, carrying from Form 8582. (ProWeb doesn't support treating this amount as nonpassive.)
9A Directly apportioned deductions - depreciation - This deduction needs to be reported on Schedule E line 33 column (e) if nonpassive, or column (c) if passive, subject to the passive activity loss rules. ProWeb does not support either of these entries.
9B Directly apportioned deductions - depletion - This deduction needs to be reported on Schedule E line 33 column (e) if nonpassive, or column (c) if passive, subject to the passive activity loss rules. ProWeb does not support either of these entries.
9C Directly apportioned deductions - amortization - This deduction needs to be reported on Schedule E line 33 column (e) if nonpassive, or column (c) if passive, subject to the passive activity loss rules. ProWeb does not support either of these entries.
10 Estate Tax Deduction
$This amount carries to Schedule A as an Other Itemized Deduction.
11A Excess Deductions on Termination
$This amount carries to Schedule 1 line 24k. Two caveats:
- Only the beneficiary of an estate or trust that actually receives the estate's or trust's assets upon termination is allowed this deduction.
- The tax benefits of this deduction cannot be carried forward. Thus, if the beneficiary's return results in a NOL, the NOL carryover must be reduced by the amount of this deduction.
11B Excess Deductions on Termination - Non-Miscellaneous Itemized Deductions
$There should be a supplemental statement attached to the K-1 providing information regarding the amount reported in Box 11 with code B. Report the amount on the appropriate line on Schedule A.
11C Short Term Capital Loss Carryover
$This amount carries to Schedule D line 5.
11D Long Term Capital Loss Carryover
$This amount carries to Schedule E line 12.
11E Net Operating Loss Carryover for Regular Tax Purposes
$This amount carries to Schedule 1 line 8a.
11F Net Operating Loss Carryover for AMT Purposes - Report this amount in Form 6251 in the field "Alternative tax net operating loss deduction"
12A Adjustment for Minimum Tax Purposes
$This amount carries to Form 6251 line 2j.
12B through 12F - If the taxpayer is not subject to AMT, these amounts can be ignored. If the taxpayer is subject to AMT, these amounts are used to adjust certain worksheets used in calculating AMT and may affect Form 6251 Part III lines 13, 14, and 15. See the Form 6251 instructions more information. ProWeb does not support modifying the relevant worksheets for these items.
12G Accelerated depreciation - If the taxpayer is not subject to AMT, this amount can be ignored. If the taxpayer is subject to AMT, enter this amount as an adjustment on Form 6251 in the field headed "Depreciation on assets placed in service after 1986 (difference between regular tax and AMT)".
12H Depletion - If the taxpayer is not subject to AMT, this amount can be ignored. If the taxpayer is subject to AMT, enter this amount as an adjustment on Form 6251 in the field headed "Depletion (difference between regular tax and AMT)".
12I Amortization - If the taxpayer is not subject to AMT, this amount can be ignored. If the taxpayer is subject to AMT, there are several potential lines on Form 6251 to which this amount relates, based on what was being amortized. Use the information provided by the fiduciary to enter it as an adjustment in the appropriate field in the Form 6251 menu.
12J Exclusion items - An amount report in Box 12 with code J is entered in the following year's Form 8801 on line 2. In ProWeb, that field is headed "Adjustments treated as exclusion items".
13A - Payments of Estimated Taxes Credited to You
$This amount will carry to Form 1040 line 26.
13B - Credit for Backup Withholding
$This amount will carry to Form 1040 line 25c.
13C Low-income housing credit - Report an amount in Box 13 with code C on Form 8586, entered as a credit from a passthrough entity. When completing Form 8586, for the purposes of the general business credit you'll need to indicate the taxpayer's participation in the credit activity, whether passive or nonpassive.
13D Advanced manufacturing production credit - An amount reported in Box 13 with code D represents the allocable Advanced Manufacturing Production Credit. Report this credit on Form 7207, entered as a credit from a passthrough entity.
You'll first need to complete Part I of Form 7207, entering the detailed information about the facility that the fiduciary should have provided to the taxpayer-beneficiary. After completing Part I, in the Form 7207 menu select Credit from Pass-Through Entities and enter the credit information.
13E Clean electricity production credit - An amount reported in Box 13 with code E represents the allocable Clean Electricity Production Credit. Report this credit on Form 7211, entered as a credit from a passthrough entity.
You'll first need to complete Part I of Form 7211, entering the detailed information about the facility that the fiduciary should have provided to the taxpayer-beneficiary. After completing Part I, in the Form 7211 menu select Credit from Pass-Through Entities and enter the credit information.
13F Work opportunity credit - An amount reported in Box 13 with code F represents the Work Opportunity Credit. This credit is reported on Form 5884, entered as a credit from a passthrough entity.
13G Credit for small employer health insurance premiums - An amount reported in Box 13 with code G represents the Credit for Small Employer Health Insurance Premiums allocable to the taxpayer. Report this amount on Form 8941. In the Form 8941 menu, select Credit from Pass-Through Entities and enter the credit information.
13H - Biofuel producer credit - An amount reported in Box 13 with code H represents the Biofuel Producer Credit. Report this amount on Form 6478, entered as a credit from a passthrough entity.
13I Credit for increasing research activities - An amount reported in Box 13 with code I represents the Credit for Increasing Research Activities. Report this amount on Form 6765, entered as a credit from an estate or trust.
13J Renewable electricity production credit - An amount reported in Box 13 with code J represents the amount of the Renewable Electricity Production Credit allocable to the taxpayer. Report this credit on Form 8835, entered as a credit from a passthrough entity.
You'll first need to complete Part I of Form 8835, entering the detailed information about the facility that the fiduciary should have provided to the taxpayer-beneficiary. After completing Part I, in the Form 8835 menu select Pass-Through Entity Renewal Energy Production Credits during 4-Year Period and enter the credit information.
13K Empowerment zone employment credit - An amount reported in Box 13 with code K represents the Empowerment Zone Employment Credit. Report this amount on Form 8844, entered as a credit from a passthrough entity.
13L Clean fuel production credit - An amount reported in Box 13 with code L represents the allocable Clean Fuel Production Credit. Report this credit on Form 7218, entered as a credit from a passthrough entity.
You'll first need to complete Part I of Form 7218, entering the detailed information about the facility that the fiduciary should have provided to the taxpayer-beneficiary. After completing Part I, in the Form 7218 menu select Credit from Pass-Through Entities and enter the credit information.
13M Orphan drug credit - An amount reported in Box 13 with code M represents the Orphan Drug Credit allocable to the taxpayer. This credit is reported on Form 8820, entered as a credit from a passthrough entity.
13N Credit for employer-provided childcare facilities and services - An amount reported in Box 13 with code N represents the Credit for Employer-Provided Childcare Facilities and Services allocable to the taxpayer. Report this amount on Form 8882. In the Form 8882 menu select Credit from Pass-Through Entities and enter the credit information.
13O Biodiesel, renewable diesel, or sustainable aviation fuels credit - An amount reported in Box 13 with code O represents the amount of the Biodiesel, Renewable Diesel, or Sustainable Aviation Fuels Credit allocable to the taxpayer. Report this credit on Form 8864, entered as a credit from a passthrough entity.
The fiduciary should have provided additional information on an attached statement. If the amount being passed through is for the small agri-biodiesel producer credit, in the Form 8864 menu enter the credit information under Credit from Pass-Through Entities - Diesel. If the amount being passed through is for the sustainable aviation fuels credit, enter the information under Credit from Pass-Through Entities - SAF.
13P Credit to holders of tax credit bonds - An amount reported in Box 13 with code P relates to one or more of the following credits:
- Clean renewable energy bond (CREB)
- New clean renewable energy bond (NCREB)
- Qualified energy conservation bond (QECB)
- Qualified zone academy bond (QZAB)
- Qualified school construction bond (QSCB)
- Build America bond (BAB)
The fiduciary should have provided additional information regarding the credit. Report this amount on Form 8912. In the Form 8912 menu, select Credit from Pass-Through Entities Not on Form 1097-BTC and enter the credit information.
13Q Credit for employer differential wage payments - An amount reported in Box 13 with code Q represents the Credit for Employer Differential Wage Payments allocable to the taxpayer. Report this amount on Form 8932. In the Form 8932 menu, select Credit from Pass-Through Entities and enter the credit information.
13R Recapture of credits - If the taxpayer is required to recapture any credits, the fiduciary will provide a statement with the information needed to figure the credit recapture. Examine the credit's and the Form 1040 instructions to determine where to report it in the tax return.
13S Credit for production from advanced nuclear power facilities - Report this amount on Form 7213 Part I, Credit for Production From Advanced Nuclear Power Facilities, Section 45J. The fiduciary should have provided the information needed to complete Form 7213. When completing Form 7213, for the purposes of the general business credit you'll need to indicate the taxpayer's participation in the credit activity, whether passive or nonpassive.
13T Zero-emission nuclear power production credit - Report this amount on Form 7213 Part II, Credit for Zero-Emission Nuclear Power Production, Section 45U. The fiduciary should have provided the information needed to complete Form 7213. When completing Form 7213, for the purposes of the general business credit you'll need to indicate the taxpayer's participation in the credit activity, whether passive or nonpassive.
13ZZ Other credits - The fiduciary should have provided information regarding the nature of the credit(s) being passed through with code ZZ. Report the credit in the return as appropriate.
14A Tax-Exempt Interest Income
$This amount carries to Form 1040 line 2a.
14B Foreign taxes - This amount can be either included on Schedule A as a deduction under "Other Taxes", or it can be claimed as a foreign tax credit, either directly on Schedule 3 or via Form 1116, based on the total foreign tax credits the taxpayer is claiming.
14C Qualified rehabilitation expenditures - An amount reported in Box 14 with code C represents the taxpayer's share of qualified rehabilitation expenditures. Report this amount on Form 3468, Part VII.
You'll first need to complete Part I of Form 3468, entering the detailed information about the facility that the fiduciary should have provided to the taxpayer-beneficiary. After completing Part I, in the Form 3468 menu select Rehabilitation Credit Under Section 47, then the same menu line again, and enter the credit information.
14D Basis of energy property - An amount reported in Box 14 with code D represents the taxpayer's share of the basis of energy property for the energy credit claimed on Form 3468 in Part VI.
You'll first need to complete Part I of Form 3468, entering the detailed information about the facility that the fiduciary should have provided to the taxpayer-beneficiary. After completing Part I, in the Form 3468 menu select Energy Credit Under Section 48, then the same menu line again, and enter the amount under the appropriate property heading.
14E Net investment income - Enter this amount as an adjustment on Form 4952 in the field headed "Adjust gross income from property held for investment". (If the taxpayer doesn't qualify for the investment interest expense deduction, Form 4952 won't be produced in the return.)
14F Gross Farming and Fishing Income
$This amount carries to Schedule E (Form 1040) line 42.
14G Foreign trading gross receipts (Section 942(a)) - This amount is needed for Form 8873, Extraterritorial Income Exclusion. This form is not supported in ProWeb.
14H Net Investment Income or Deduction Adjustment
$This amount is a modification of net investment income. It carries to line 7 of Form 8960, Net Investment Income Tax, and also modifies MAGI on Form 8960. (If the taxpayer isn't subject to net investment income tax, Form 8960 won't be produced in the return.)
14I Section 199A information - See below for Section 199A information.
14J Qualifying advanced coal project property and qualifying gasification project property - An amount reported in Box 14 with code J represents the taxpayer's share unused investment credit from the qualifying advanced coal project credit or qualifying gasification project credit. Report this amount on Form 3468, Part II.
You'll first need to complete Part I of Form 3468, entering the detailed information about the facility that the fiduciary should have provided to the taxpayer-beneficiary. After completing Part I, in the Form 3468 menu select Qualifying Advanced Coal and Gasification Project Credit, then the same menu line again, and enter the amount under the appropriate property heading.
14K Qualifying advanced energy project property - An amount reported in Box 14 with code K represents the unused investment credit from the qualifying advanced energy project credit. Report this amount on Form 3468, Part III.
You'll first need to complete Part I of Form 3468, entering the detailed information about the facility that the fiduciary should have provided to the taxpayer-beneficiary. After completing Part I, in the Form 3468 menu select Qualifying Advanced Energy Project Credit Under Section 48C, then the same menu again, and enter the credit information.
14L Advanced manufacturing investment property - An amount reported in Box 14 with code L represents the unused investment credit from the advanced manufacturing investment credit. Report this amount on Form 3468, Part IV.
You'll first need to complete Part I of Form 3468, entering the detailed information about the facility that the fiduciary should have provided to the taxpayer-beneficiary. After completing Part I, in the Form 3468 menu select Qualifying Advanced Manufacturing Investment Credit Under Section 48D, then the same menu again, and enter the credit information.
14M Clean electricity investment credit - An amount reported in Box 14 with code M represents the unused investment credit from the clean electricity credit. Report this amount on Form 3468, Part V.
You'll first need to complete Part I of Form 3468, entering the detailed information about the facility that the fiduciary should have provided to the taxpayer-beneficiary. After completing Part I, in the Form 3468 menu select Clean Electricity Investment Credit Under Section 48E, then the same menu again, and enter the credit information.
14ZZ Other information - Examine the information the fiduciary provided about the item(s) reported in Box 14 with code ZZ.
Qualified Business Income, Section 199A
Income
$The amount reported in Box 14 with code I is Qualified Business Income (QBI). This amount will automatically carry to Form 8995 or Form 8995-A to be used in the calculation of QBID.
W-2 wages
$Section 199A W-2 wages are the wages paid by the estate or trust that were reported to the Social Security Administration on a W-2. The amount entered is used in the calculation of the QBID for taxpayers above the taxable income thresholds.
Unadjusted basis
$This amount represents the unadjusted basis of qualified property held by the estate or trust. The amount entered is used in the calculation of the QBID for taxpayers above the taxable income thresholds.
REIT dividends
$This amount represents the REIT dividends received by the estate or trust. This amount is used in the calculation of the QBID.
PTP income
$This amount represents the PTP income received by the estate or trust. This amount is used in the calculation of the QBID.
Note: This is a guide on entering the items from Schedule K-1 (Form 1041) Part III into individual income tax return in TaxSlayer ProWeb. This is not intended as tax advice.
Additional Information: