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Entering Partnership Schedule K-1 Line/Box 13 Code J in the Individual Module

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Intuit

Entering Partnership Schedule K-1 Line/Box 13 Code J in the Individual Module

Where do I enter Partnership Schedule K-1, line 13, code J- Section 59(e)(2) Expenses in the Individual module?

How do I report Partnership Schedule K-1, box 13J for an Individual return?

Solution:

To enter line 13, Code J:
  1. Go to Screen 20, Passthrough K-1s.
  2. Select the Partnership from the left navigation panel.
  3. Scroll down to the Line 13 - Other Deductions section.
  4. Locate the (J) Section 59(e)(2) Expenses subsection.
  5. Select the Type of expenses (Ctrl+T) from the drop down menu.
  6. Enter the (13J) Amount reported on Schedule K-1.
  7. Enter any Dry hole expense. (if applicable).

Notes:

  • The partnership should have attached the type and amount of Section 59(e)(2) expense on a statement attached to the K-1. Enter the type of expense indicated on that statement.
  • If these expenses are deducted in full in the current year, they are treated as an adjustment or tax preference item for the purposes of alternative minimum tax. Generally section 59(e)(2) allows the partner to amortize the expense of a number of years to avoid the Alternative minimum tax adjustment. Only enter expenses you want to deduct in full in the K-1 input screen. To amortize the amount enter the expense on Screen 22, Depreciation and tie the asset to the passthrough entity.
  • To amortize circulation costs:
    1. Go to Screen 22, Depreciation.
    2. Click Add from the middle left navigation panel.
    3. Enter the basic information about the Circulation costs:
      1. Description of property
      2. Select the Form from the drop down menu.
      3. Select the Activity name or number from the drop down menu.
      4. Select 8 from the Category drop down menu.
      5. Enter the Date placed in service.
      6. Enter the Cost or Basis.
    4. Enter 91 in Method.
    5. Enter 3 in Life or class life.
    6. Select 59 = Sec. 59 - Optional Write-Off of Tax Preferences from the Amortization code section (Ctrl+T) drop down menu.
  • To amortize mining exploration or development costs:
    1. Go to Screen 22, Depreciation.
    2. Click Add from the middle left navigation panel.
    3. Enter the basic information about the Circulation costs:
      1. Description of property
      2. Select the Form from the drop down menu.
      3. Select the Activity name or number from the drop down menu.
      4. Select 8 from the Category drop down menu.
      5. Enter the Date placed in service.
      6. Enter the Cost or Basis.
    4. Enter 91 in Method.
    5. Enter 10 in Life or class life.
    6. Select 59 from the Amortization code section (Ctrl+T) drop down menu.
  • To amortize research and experimental expenditures:
    1. Go to Screen 22, Depreciation.
    2. Click Add from the middle left navigation panel.
    3. Enter the basic information about the Circulation costs:
      1. Description of property
      2. Select the Form from the drop down menu.
      3. Select the Activity name or number from the drop down menu.
      4. Select 8 from the Category drop down menu.
      5. Enter the Date placed in service.
      6. Enter the Cost or Basis.
    4. Enter 91 in Method.
    5. Enter 10 in Life or class life.
    6. Select 59 or 174 from the Amortization code section (Ctrl+T) drop down menu.
  • To amortize intangible drilling costs:
  1. Go to Screen 22, Depreciation.
  2. Click Add from the middle left navigation panel.
  3. Enter the basic information about the Circulation costs:
    1. Description of property
    2. Select the Form from the drop down menu.
    3. Select the Activity name or number from the drop down menu.
    4. Select 8 from the Category drop down menu.
    5. Enter the Date placed in service.
    6. Enter the Cost or Basis.
  4. Enter 97 in Method.

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