Why doesn't the difference between the Federal and CA gain on disposal of assets (not section 179 assets) get included in the income allocated to Line 1 of the K1?
The California K-1 doesn't show any adjustments?
Did you prepare the business return or just the 1040 with the K-1?
Yes, I prepared the entity S corp return. The K1 shows adjustments on line 1 from Federal to CA. But it doesn't include the difference in the ordinary gain on disposal of assets.