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Screen K1-3 - Schedule K-1, 1065 / 1120S - Deductions (1040)

Partner's / Shareholder's Share of Deductions

Enter the section 179 expense passed through in this field. The allowable deduction calculates automatically. Amounts you enter here combine with amounts you enter in the 4562 screen and are subject to basis, passive-loss, and at-risk limitations, if applicable.
From the Schedule K-1, use the attached statements to enter the noncash contributions subject to various AGI limits. Also, enter the adjusted basis of the property contributed by the entity.
For partnerships and S Corporations, the amount of the adjusted basis of the property will be subject to basis and at-risk limitations, if applicable. The difference between the Schedule K-1 amount and the adjusted basis, plus the adjusted basis of the property after applying any applicable basis or at-risk limitation, will transfer to Schedule A, line 12.
If the entity provided a copy of Form 8283, Noncash Charitable Contributions, it must be attached to the 1040 return. If the total claimed deductions exceed $500, Form 8283P1 and a supporting statement detailing the amount appearing in Form 8283P1, column G, generate automatically.
Enter investment interest expense for this activity to report it on Form 4952 and to deduct it on Schedule A. All amounts are subject to basis and at-risk limitations, and amounts on Schedule E are subject to passive-loss limitations, if applicable.
Enter investment interest expense to report directly on Schedule E. All amounts are subject to basis and at-risk limitations, and amounts on Schedule E are subject to passive-loss limitations, if applicable. Amounts you enter here don't go to Form 4952. If the amount should be limited, enter the limited amount here.
Enter the amount of debt-financed acquisition interest allocated to trade or business assets or expenditures. This amount reports in Part II, Schedule E on a separate line as "passive interest" if the activity is passive or as "business interest" if the activity is not.
Enter royalty expenses for Schedule E, Page 1. No limitations or preferences will calculate based on data you enter here. If you have the UltraTax/Oil & Gas module, enter this information in the OGWell screen.
Enter the intangible drilling costs that will be expensed as reported on Schedule K-1 for this entity. These amounts will go on Schedule E, Page 2 on a separate line as "Section 59(e)(2) expensed." All amounts are subject to basis, at-risk, and passive-loss limitations, if applicable. If you have the UltraTax/Oil & Gas module, also enter this information in the OGWell screen.
Enter the circulation expenditures that will be expensed as reported on Schedule K-1 for this entity. These amounts will go on the Schedule E, Page 2 on a separate line as "Section 59(e)(2) expenditures." All amounts are subject to basis, at-risk, and passive-loss limitations, if applicable. For alternative minimum tax purposes, the expense is deductible ratably over three years. A preference item equal to the regular tax expense less the one-third amount allowed for minimum tax purposes is created for Form 6251, line 2o - Circulation costs. When basis, at-risk, and passive-loss limitations are applicable, use the ratable expense allowed for AMT purposes on the AMT version of those worksheets. Report any difference between regular tax and AMT expense on Form 6251, lines 2m or 2n.
Enter the research and experimental expenditures that will be expensed as reported on Schedule K-1 for this entity. These amounts will go on the Schedule E, Page 2 on a separate line as "Section 59(e)(2) expenditures." All amounts are subject to basis, at-risk, and passive-loss limitations, if applicable. For alternative minimum tax purposes, if the activity is passive, the expense is deductible ratably over ten years. For the passive activity, use the ratable expense allowed for AMT purposes on the AMT version of the basis, at-risk, and Form 8582 worksheets. Report any difference on Form 6251, line 2m.
Enter the mining exploration and development costs that will be expensed as reported on Schedule K-1 for this entity. Amounts you enter here go on Schedule E, Page 2 on a separate line as "Section 59(e)(2) expenditures." All amounts are subject to basis, at-risk, and passive-loss limitations, if applicable. For alternative minimum tax purposes, the expense is deductible ratably over ten years. A preference item equal to the regular tax expense less the one-tenth amount allowed for minimum tax purposes is created for Form 6251, line 2q - Mining costs. When basis, at-risk, and passive-loss limitations are applicable, use the ratable expense allowed for AMT purposes on the AMT version of those worksheets. Report any difference between regular tax and AMT expense on Form 6251, lines 2m or 2n.
Enter the deductions attributable to this activity's portfolio income. This amount goes to the appropriate line on Schedule A.
Enter the amount of nonspecified health insurance premiums paid in conjunction with the insurance plan established or considered to be established with this activity. However, if the taxpayer obtained the specified premiums via the Health Insurance Marketplace, see the notes section below. The self-employed health insurance deduction calculates automatically for Page 1, of the 1040 (or 1040NR) return.
Use this field only if the shareholder's medical insurance was not on the shareholder's W-2 issued by the S Corporation. Amounts you enter here show as medical and dental expenses on Schedule A. Don't enter the amount again on the A screen. If using basis and the amount was on the shareholder's K1 as other information, instead of as a shareholder distribution, enter an amount in the
Medical insurance subject to basis limitation
 field in the K1-3 screen.
Use the attached statement to enter eligible long-term care insurance premiums paid on behalf of the taxpayer, spouse, and/or dependents, applicable to this K-1 entity. The deduction is limited based on the age of the taxpayer, spouse, or dependents as designated by the code entered in the statement.
The deductible amount is applied based on the entry in the
T, S, J
 field at the top of the K1 screen. If you select
J
 from the
T, S, J
 field, the deductible premium amount is split equally between the taxpayer and spouse. The Self-Employed Health Insurance Deduction Worksheet showing the calculation prints when applicable. The amount not allowed, as a deduction for Page 1, line 29 of the 1040 return automatically transfers to Schedule A as a medical deduction.
The codes that are available in the
State Use
 field in the attached statement are specific to the state postal code entered in the
State
 field. If state use codes are not applicable to the entered state, state use codes will not be available.
Enter the dependent care benefits reported on the Schedule K-1 for this entity. Amounts you enter here go to Form 2441, line 12. Amounts are subject to basis or at-risk loss limitations, if applicable.
Use the attached statement to enter amounts to report separately on Schedule E, Page 2. Amounts here are subject to basis and at-risk limitations, if applicable. The calculation of self-employment income deducts amounts with type code
1
 for Schedule SE and other earned income calculations, if applicable. These amounts are subtracted from Net earnings (loss) from self-employment on the K1-4 screen.

This article applies to:

  • Product: UltraTax CS
  • Return type: 1040 Individual
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