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Excess business interest

taxed2max
Level 3

Client has excess business interest from a k-1, one of those PTPs in oil&gas that rolled up this year into the parent corporation when feds changed their pricing mechanism (so assume will be many more out there).  Input in K-1 (screen 20) and Lacerte carries to the 8990 and merely hangs it there to be carried over even with K-1 marked as final.  Since the rollup is considered taxable, the gain is shown on sch D and that input was linked back to the K-1 and also checked for at risk.  But Lacerte does nothing with this.  After hours with tech support being futile, I figured the gain manually and dropped it into the K-1 input (20AE) as excess income.  Now Lacerte allows the interest to be recognized on the 8990 but still does nothing with it (though now you get a diagnostic).   So manually added the expense item to the 2106 input and directed it back to the K-1.  Now it seems to work, and I also get a reconciled basis amount of zero.  But what a clumsy way to do this.   So did Lacerte drop the ball here or am I misunderstanding my way around how the new input should work?  Thanks.

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Kathi_at_Intuit
Employee
Employee

If you were to type in the search box in the upper right of Lacerte "8990" and click on Search it would bring up this knowledge base for you:

Generating Form 8990

https://accountants-community.intuit.com/articles/1807622&src=lsccom

 

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3 Replies 3
JimmyM
Employee
Employee

Form 8990 is included in Lacerte and ProConnect Tax Online. Amounts from within the return will flow to the 8990, and the 8990 will calculate the limitation on business interest. However, once the 8990 is triggered and calculated, you should also have a diagnostic in the return indicating that the amounts on the 8990 will not flow back to the return. Any adjustments needed in the return once the 8990 has been completed will need to be made manually. Please let us know if you do not have this diagnostic included with your diagnostics in the return. 

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MO
Level 1

The only interest I have is on the Form 8825, and is not flowing to the 8990.   The form is triggered but nothing is filled out.  Please help.  Thanks.

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Kathi_at_Intuit
Employee
Employee

If you were to type in the search box in the upper right of Lacerte "8990" and click on Search it would bring up this knowledge base for you:

Generating Form 8990

https://accountants-community.intuit.com/articles/1807622&src=lsccom

 

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