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Screen ACA Tax - Net Investment Income Tax Add'l Medicare Tax

Form 8960 — Net Investment Tax

Data entry on this screen is not required to calculate and print Form 8960; UltraTax CS automatically calculates the form from data entry elsewhere in the client file.
Married taxpayers who file a joint Federal income tax return pursuant to a section 6013(g) or 6013(h) election may also make the same election for purposes of calculating the net investment income tax. This election is selected automatically when there is an entry on the 1040 screen for
Elect to file joint return with nonresident alien spouse
. If this election is not made for Form 8960 when the election is made for the Federal return, Form 8960 will have to be adjusted.
An individual may make an election with respect to all interests in controlled foreign corporations and qualified electing funds to include in net investment income all amounts included in gross income under section 951(a) or sections 1293(a)(1)(A) and (B). Enter the name of the CFC or QEF and the EIN or Reference ID Number to make this election for the current year and all subsequent years. Elections made in the prior years are proforma'd to the
Section 1.411-10(g) election prior year(s) detail
 statement.
UltraTax CS automatically adds the taxable amount of all distributions entered on the 1099R screen with the
Nonqualified annuity (Code D)
 field marked. Enter an amount here to force a different amount for Form 8960 line 3.
UltraTax CS automatically enters the following as an adjustment to net investment income on Form 8960, line 4b: Income or loss from any trade or business that appears on Schedule 1, line 5 (Form 1040) but is not a section 1411 trade or business. Income is entered as a negative adjustment, and loss is entered as a positive adjustment. Use this field to add additional adjustments.
Enter any net gain or loss from the disposition of property that is included on Form 1040, line 6 and Schedule 1, line 4 (Form 1040) but is not subject to the net investment income tax. Property is not a net investment income if it was held in a business that was not a passive activity or a trade or business in trading financial instruments or commodities. By default, UltraTax CS assumes that gain or loss on the disposition of property held in a business that is not a section 1411 trade or business is not net investment income. Use this field to make additional adjustments.
For the disposition of an active interest in a partnership or S corporation as described in section 1411(c)(4)(A), the gain or loss is taken into account for net investment income only to the extent of the net gain that would be taken into account if all the property of the partnership or S corporation were sold for fair market value immediately before the disposition of the interest, per Regulations section 1.1411-7.
By default, UltraTax CS excludes from net investment income all gain or loss entered in the Schedule D
Schedule for detail
 on the B&D screen coded as Type
Business
 and the Form and Unit selected are a trade or business to which net investment income tax does not apply. If the transaction is a disposition of interest in the partnership or S corporation, enter the details of the disposition in the attached statement. UltraTax CS includes this information in the required statement for Form 8960 and produces the Form 8960, Line 5c, Adjustment from disposition of partnership interest or S corporation stock worksheet on Form 8960 – Net Investment Income Worksheet 3. For current year dispositions, the sum of the statement columns
Gain(Loss) on Disposition of Property
 and
Adjustment to (Gain)Loss From Disposition
 will flow to line 2 of the worksheet for a gain, or to line 5 for a loss. Because the disposition is related to an active trade or business, UltraTax CS excludes the amount on Form 8960 – Net Investment Income Worksheet 1, Line 5b, and will add back the unadjusted Gain(Loss) on Disposition of Property amount to that worksheet with the description "Disposition of interest per 1411(c)(4)(A).” If the disposition is the first year of an installment sale, enter the current year in the
Installment Sale First Reported
 column.
By default, UltraTax CS includes in net investment income all gain on installment sales from the InstPY screen in the PerSale folder. If an installment sale represents a prior year disposition of an active interest in a partnership or S corporation the gain may need to be adjusted by UltraTax CS of Regulations section 1.1411-7. Enter the details of the disposition in the attached statement and indicate that it refers to an installment sale by entering the year of the disposition in the
Installment Sale First Reported
 column. UltraTax CS includes the Gain(Loss) on Disposition of Property on line 7 of the worksheet, and the Adjustment to (Gain)Loss From Disposition on line 9 of the worksheet.
If the election under section 1.1411-10(g) is not made, the timing of income derived from an investment in a CFC or QEF may be different for income tax and net investment income tax purposes. Use this field to enter any adjustments to net investment income that are required in the absence of this election.
UltraTax CS includes the following as modifications to investment income.
  • Net profit from any Schedule C or Schedule F activity that is coded as a
    Trade or business to which Net Investment Income Tax (NIIT) applies
  • Amounts entered on the Income screen,
    Other income
     statement with Federal code 6, Investment income
  • Amounts entered on the 1099M screen in the
    Substitute pymts in lieu of dividends/interest
     field
  • Investment income from Form 8814
  • Other portfolio income
     from the K1-2 screen
  • Section 1411 net operation loss utilized from Net Investment Income Worksheet 2
  • State and local tax deduction recoveries from Net Investment Income Worksheet 5
Use this field to enter any other modifications to investment income that should appear on Form 8960 line 7.
UltraTax CS automatically calculates investment interest expenses that apply to net investment income and enter that amount on Form 8960 line 9a. Use this field to force a different amount from the calculated amount.
UltraTax CS automatically calculates the state and local income taxes to report on Form 8960, line 9b, using a reasonable method of allocation per Form 8960 instructions. Use this field to force a different amount on Form 8960, line b.
The state and local income taxes paid from the St Pmt, W-2, B&D, 1099M, Income, 1099R, C, Rent, 4835, K1-3, K1T, and A screens are included. Taxes on unemployment compensation, gambling income, disability, or social security are not included. The included taxes are allocated to net investment income and can be viewed on a not-required statement for Form 8960, line 9b.
UltraTax CS automatically calculates miscellaneous investment expenses that apply to net investment income and enters that amount on Form 8960, line 9c. Use this field to force a different amount on Form 8960, line 9c.
Use this field to enter any other modifications to investment expenses that should appear on Form 8960 line 10.
Use this field to enter any adjustments to AGI described in Regulations section 1.1411-10(e)(1). If there is a positive amount reported on Schedule K-1 (Form 1041) box 14 code H, enter the amount here and also in the
Other modifications to investment income
 field, above.
For purposes of calculating the section 1411 NOL, it is necessary to recompute the NOL using only items of income, gain, loss, and deduction on Form 8960. This calculation is shown on Form 8960 – Net Investment Income Worksheet 4. Use the fields in this section to force different amounts from the calculated amounts in the calculation of the section 1411 NOL.
Prior year net investment income NOL is proforma'd to the NOLCO screens in the 1045 & NOL folder.
Use the attached statement to record details about the prior tax year that is required to calculate any adjustment to net investment income based on a state tax refund. UltraTax CS automatically proformas the information from the prior year if there was a state or local tax deduction on Form 8960, line 9b. If this statement is blank, UltraTax CS defaults to no adjustment for any refund.
Enter the tax year to which the refund applies. A refund from a tax year before 2013 is not applicable to net investment income. If the modified adjusted gross income was below the net investment income threshold, enter
X
 in the column MAGI Below Threshold. Otherwise, enter the net investment income information from the tax year of the refund.
The adjustment from the prior year 8960 – Net Investment Income Worksheet 1 automatically proformas. This amount corresponds to the amount that would be reported on the Form 8960 instructions, Lines 5a-5d – Net Gains and Losses Worksheet, line 2(h).
Use the attached statement to record details about the elections taken for any controlled foreign corporations or qualified electing funds. The statement includes the following fields.
  • Description:
     Enter a brief description of the election taken.
  • Tax Year:
     Enter the tax year the election was taken.
  • Effective Period:
     Enter the election's effective period. Some elections are perpetual, while others only cover the tax year taken.
  • Effective Period:
     Enter the election's effective period. Some elections are perpetual, while others only cover the tax year taken.
UltraTax CS automatically proformas the name and EIN or Reference ID number for all controlled foreign corporations or qualified electing funds for which the section 1.1411-10(g) election was made. This election applies to all stock of the CFC or QEF held or subsequently acquired and is irrevocable.
Enter an amount if Form 8960, line 14 (Threshold) should use an amount that is different from that specified in the Form 8960 instructions because the child’s return includes Form 8615, Tax on Certain Children Who have Unearned Income.

Form 8959 — Additional Medicare Tax

To force Form 8959 to print if it has data and whether or not it is required, modify your print collations. See Customizing the tax return print collation for more information.
UltraTax CS automatically adds all amounts entered on the W2 screen, box 5 and places the total on Form 8959 line 1. Use this field to adjust the amount on Form 8959 line 1.
UltraTax CS automatically adds all amounts entered on the W2 screen, box 6 and box 12 coded B or N and places the total on Form 8959 line 19. Use this field to adjust the amount on Form 8959 line 19.
UltraTax CS automatically adds all amounts entered on the W2 screen, box 14, coded 44 and places the total on Form 8959 line 14. If this amount should be adjusted, enter the adjustment figure here.
UltraTax CS automatically adds all amounts entered on the W2 screen, box 14, coded 46 and places the total on Form 8959 line 23. If this amount should be adjusted, enter the adjustment figure here.
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