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Screen IAAdjS - Iowa Adjustments (1120)

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Additions and Reductions

Interest and dividends exempt from federal income tax
Tax-exempt interest and dividends transfer to this statement from the federal return. To include tax exempt interest and dividends on the Iowa tax return, enter a code to specify the type of income.
Type Code
Description
Destination
1
Interest
Form IA 1120S, Part III, line 2 and Part IV, line 3
2
Dividends
Form IA 1120S, Part III, line 2
Other additions
Enter other additions to Iowa taxable income. Amounts entered in this field return to Form IA 1120S, Part III, line 3.
50% federal income tax (Force)
Enter 50 percent of the federal tax paid or accrued. If this field is blank for an accrual taxpayer, the application defaults to 50 percent of the federal tax paid on federal Form 1120S.
Other reductions
Enter other reductions from Iowa taxable income. The amount of income from Alcohol Fuel Credit, Work Opportunity Credit wage reduction, and Social Security and Medicare Tip Credit tax reduction transfer from the federal return. To exclude an item from the state return, delete the amount or the entire line item from the statement. The application displays the modified column in black and will not overwrite the new data with subsequent federal-to-state data transfers. For more information, (including details on setting a user preference to mark fields for which you overruled the transferred amount), refer to the Statements overview.

Sale or Exchange of Section 179 Property

Gain (loss) reported separately from federal Schedule K, line 17d
Per the Form 4797 instructions, S Corporations are required to separately report to the shareholders the sale, exchange, or other disposition of assets where a Section 179 expense deduction was claimed in a prior year. These asset dispositions are no longer reported on federal Forms 4797, 4684, 6252, or 8824, but instead are separately reported on federal Schedule K, line 17d and in the Schedule K-1 statements. The gain or loss on the disposition of Section 179 assets is calculated from information entered in federal Screens SalePT and 8824PT in the Income and activities folders, and Screens K1Sale and 8824 in the K1 1065, 1041 folder.
The application reduces the basis of the asset by the amount of the Section 179 deduction when calculating the gain or loss. This amount is included on Form IA 1120S, line 1; Form 1040C; and Schedule K-1. A not required statement prints detailing this amount. Use this force field to override the calculated amount. If
0
 (zero) is entered, no adjustment is made.

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