Below are answers to frequently asked questions about passthrough income reported on Schedule E, page 2.
How do I check 'yes' on line 27?
The program will check this box automatically when you report the specified prior year losses or unreimbursed partnership expenses (UPE) for any activity.
- Note that this box will only get checked if all or part of the losses are allowed to be absorbed this year. To enter the carryover amounts see the input for the carryover type:
- Prior year At Risk carryover amounts can be entered under: Input Return ⮕ Income ⮕ Passthrough K-1s ⮕ select the activity type ⮕ At Risk,
- Prior year basis carryovers can be entered under: Input Return ⮕ Income ⮕ Passthrough K-1s ⮕ select the activity type ⮕ Basis
- Prior year basis carryovers can be entered under: Input Return ⮕ Income ⮕ Passthrough K-1s ⮕ select the activity type ⮕ Passive C/O.
- Unreimbursed partnership expenses can be entered directly under Input Return ⮕ Income ⮕ Passthrough K-1s ⮕ select the activity type ⮕ Less Common Scenarios or calculated by ProConnect.
How do I check 28f for 'amount not at risk'?
ProConnect will only check the box in column f on line 28 when both of these are true for an activity:
- Form 6198, At-Risk Limitations is generated and shows a current year loss that exceeds the amount at risk, and
- At least part of the loss is allowed on Schedule E after the passive limitation is applied.
See Understanding at-risk limitations for K-1 losses for instructions on generating Form 6198.
If you're not sure why a loss isn't flowing to the Schedule E, check the K-1 Reconciliation Worksheet.
How do I check the box for 'basis computation required'?
ProConnect will automatically check this box for S-Corporation activities where a loss is reported, your client received a distribution or loan repayment, or disposed of stock.
