How to report partnership K-1, Box 13 code W on an individual return in ProConnect Tax

There's no input code available for code W due to the variety of information that can be reported here. Amounts with this code may include, but aren't limited to:

• Itemized deductions:
  • Should be entered under Deductions ⮕ Itemized Deductions then on the best line that fits the description provided.
• Soil and water conservation expenditures and endangered species recovery expenditures:
  • See section 175 for limitations on the amount you're allowed to deduct.
• Expenditures for the removal of architectural and transportation barriers to the elderly and disabled that the partnership elected to treat as a current expense:
  • The deductions are limited by section 190(c) to $15,000 per year from all sources.
• Interest expense allocated to debt-financed distributions:
  • The manner in which you report such interest expense depends on your use of the distributed debt proceeds. If the proceeds were used in a trade or business activity, report the interest on line 28 of Schedule E (Form 1040). In column (a) enter the name of the partnership and “interest expense.” If you materially participated in the trade or business activity, enter the amount of interest expense in column (h). If you didn't materially participate in the activity, follow the instructions for Form 8582 to determine the amount of interest expense you can report in column (f). See page 3 in the Partner’s Schedule K-1 instructions for a definition of material participation. If the proceeds were used in an investment activity, enter the interest on Form 4952. If the proceeds are used for personal purposes, the interest is generally not deductible.
• Interest paid or accrued on debt properly allocable to your share of a working interest in any oil or gas property (if the liability isn't limited):
  • If you didn't materially participate in the oil or gas activity, this interest is investment interest reportable as described on page 9 of the Partner’s Schedule K-1 instructions; otherwise, it's trade or business interest. If you didn't materially participate in the oil or gas activity, this interest is investment interest expense and should be reported on Form 4952. If you materially participated in the activity, report the interest on line 28 of Schedule E (Form 1040). On a separate line, enter “interest expense” and the name of the partnership in column (a) and the amount in column (h).
• Penalty on early withdrawal of savings:
  • Report this amount under Income ⮕ Interest income (1099-INT, 1099-OID), select Details then under Other enter as Early withdrawal penalty.
• Film and television production expenses:
  • The partnership will provide a statement that describes the film or television production generating these expenses. Generally, if the aggregate cost of the production exceeds $15 million, you aren't entitled to the deduction. The limitation is $20 million for productions in certain areas (see section 181 for details). If you didn't materially participate in the activity, use Form 8582 to determine the amount that can be reported on Schedule E (Form 1040), line 28, column (f). If you materially participated in the production activity, report the deduction on Schedule E (Form 1040), line 28, column (h). The partnership will give you a description and the amount of your share for each of these items.

To report Schedule K-1, Box 13, code W without having descriptions or instructions about the deductions:

1. Go to Input Return ⮕ Income ⮕ Passthrough K-1's ⮕ Partnership Info (1065 K-1).
2. Select the Less Common Scenarios tab.
3. Scroll down to the Separately Stated Income and Deductions subsection.
4. To report the deduction as passive:
   1. Scroll down to First Passive Item.
   2. Click in the amount field to open the input box.
   3. Enter the Description.
   4. Enter the Amount as a negative number.
   5. Select OK.
   6. If the loss is allowed after passive limitations are applied, the entry will flow to the Schedule E, Page 2, Line 28 column (f), Passive loss allowed (attach Form 8582 if required).
5. To report the deduction as nonpassive:
   1. Scroll down to Other nonpassive income.
   2. Click in the amount field to open the input box.
   3. Enter the Description.
   4. Enter the Amount as a negative number.
   5. Select OK.
   6. This entry will flow to the Schedule E, Page 2, Line 28 column (h) Nonpassive loss from Schedule K-1.