Box 13 has no entry for 754 depreciation, but box 20 has an item that lists an amount identified as 754 depreciation. I'm unsure how to enter this amount. ... Using the TT input screens enter it as noted above as if it were reflected this way on your K-1, or; Net the Section 754 amount with your line 1 amount. Doubt you will receive any kind of ...
The K-1 we received from the partnership is fairly straight forward, except the handling of Section 754 Depreciation. The accountant for the partnership lists the depreciation under 20 AH. When I plug in the depreciation value under 20AH within Turbotax, there is no correlating deduction to the taxes owed or in my case to be refunded.
I think the only way around this is to either 1) go ahead and deduct the depreciation from the amount reported as a loss from the partnership on line 2 of the K-1 and make a note of it if ever questioned about it or 2) create a 2nd K-1 entry just for the depreciation amount, which gives a better audit trail. I do not understand why this was ...
The previous tax preparer shows an amount on K-1 on line 13 with code "W". However, there is no coinciding entry on partner's individual tax return and the amount on line 13 of the K-1 is not included in line 2 of the K1. Could other tax preparers enlighten me as to why the K-1 entry from line 13 would not flow to the individual tax return?
In 2022 Form 1065, go to Page 4, Line 13(G)((c) It lists Section 754 depreciation. Fill in code W and then the amount. In the Special Allocation box next to it I put in "1". Then I went to the Schedule K-1 Worksheet for that specific partner and By Ratio in Special Allocations I list next to #1 "100.00000" for the percentage.
The section 743(b) adjustments and 754 adjustments will be included in the calculation of either the other increases amount on line 4 or the other decreases amount on line 7 depending on whether the section 743(b) income adjustment on Schedule K are positive or negative and section 754 adjustments are present on Schedule K, line 13d.
If so, you would expect the adjustment to have already been applied against that partner's income on the K-1. On that basis, you will not need to enter that "again" on the 1040. You may like to verify whether the adjustment was indeed not made on the K-1 against the income of that partner in the first instance.
The Schedule K-1 codes have changed for tax year 2023. The entry for Section 754 depreciation can be found on Form 1065 p5-6 under Line 13(e)(C). Use code ZZ from the drop-down menu. What you enter here will also appear at the bottom of Line 13 under Type.
Under Section 754, a partnership may elect to adjust the basis of partnership property when property is distributed or when a partnership interest is transferred.. The purpose of a Section 754 election is to reconcile a new partner’s outside and inside basis in the partnership. This election allows the new partner to receive the benefits of depreciation or amortization that he or she may not ...
Each 754 asset entry worksheet applies to one and only one partner, so it could be linked to that partner and the entire process be automated. And, yes, of course, checking the Sec 754 box on the asset entry worksheet causes the Sec 754 depreciation to flow to the 1065 which can then be specially allocated among partners through the K-1 worksheet.
There is no specific “754 election form.” The statement is a declaration that the partnership elects to apply the provisions of IRC § 734(b) or 743(b) and must be signed by a partner authorized to sign the tax return. The adjustments are then reported on Schedule K-1(s).
The 2022 version of Turbo Tax Premier was setup with a specific code for depreciation under line (box) 13. The K-1 reported code within turbotax contained a specific code for the depreciation identified as "W for Section 754 depreciation" which automatically subtracted the amount from the income.
K-1 Income: Her 1120S K-1 shows $70,000 of ordinary business income (and maybe some small interest or depreciation items, but assume just $70k). She reports that $70k on Schedule E. She reports that $70k on Schedule E.
Go to the next section Separately Stated Income and Deductions enter it as First Passive Item IRC 754 depreciation as a negative number. I am assuming that it is related to a a passive rental, if not maybe it will be in the Other NonPassive items. Answers are easy. Questions are hard! View solution in original post.
Trust’s basis in Company stock is further increased as a result of the tax on this income to $1.5 million, the sum of the $750,000 date of death value and the $750,000 gain passed through on Company’s K-1 to Trust. §1367(a)(1). Because the distribution is a full liquidation of Company and Trust’s basis in Company stock exceeds the fair ...
Just spoke w TT Help, and fixed quickly. Do record the amount from Box 13 on your K-1, under the code noted on te K-1. If you have an amount reported in Box 20, reduce that amount by the amount in Box 13.
