NCCD401S-2110, NCCD401S-2120, and NCCD401S-2140 e-file error
You get one of these errors when GoSystem Tax and North Carolina round Schedule K Shareholder lines differently.
Error message
Reject Code NCCD401S-2110 [CD-401S] For each Schedule K Shareholder, line 5 must equal line 4 multiplied by Schedule H line 11 (with the result rounded to the nearest whole number). Reject Code NCCD401S-2120 [CD-401S] For each Schedule K Shareholder, line 6 must equal line 4 multiplied by Schedule I line 1 (with the result rounded to the nearest whole number). Reject Code NCCD401S-2140 [CD-401S] For each Schedule K Shareholder, line 7 must equal line 4 multiplied by Schedule I line 2 (with the result rounded to the nearest whole number).
Solution
GoSystem Tax and North Carolina round these lines differently. North Carolina calculates each shareholder line by multiplying the total amount by the shareholder's ownership percentage. This method gives correct individual line amounts, but the totals for all shareholders may not add up correctly.
Use the following steps when you get any of these rejections:
- Count the number of rejects for each rule.
- For a return with 13 shareholders that generates 2 rejects for NCCD401S-2120 and 3 rejects for NCCD401S-2140, you would:
- Override Schedule K, line 6, for the 2 shareholders affected by the NCCD401S-2120 rejects.
- Override Schedule K, line 7, for the 3 shareholders affected by the NCCD401S-2140 rejects.
- Perform the following calculations for each shareholder:
- Multiply the percentage of stock ownership by Form CD-401S, Schedule H, line 11. Then round the result to the nearest whole number to determine the correct amount for Schedule K, line 5.
- Multiply the percentage of stock ownership by Form CD-401S, Schedule I, line 1. Round to the nearest whole number to get the amount for Schedule K, line 6.
- Multiply the percentage of stock ownership by Form CD-401S, Schedule I, line 2. Round to the nearest whole number to get the amount for Schedule K, line 7.
- Override Schedule K in Tax Forms with the amount you calculated in Step 2 for any shareholder whose amount differs from the amount shown on Schedule K.
