Question, ARB or anyone who knows, the Ord Income from line 1 of K1, TT is showing it on Sched E on 28 A j non passive vs 28 A g passive which the instructions say it should go. Am I doing something wrong with the data input?
Here is are some relevant posts to dealing with your capital account going negative. If you figure out how to translate this to TT actions, you might consider writing it into a procedure for us. That has the advantage that you help us for when we are in that situation, and somebody may be able to review and perhaps correct your process if you have missed something.
I found it interesting that the professional software did not handle this case automatically.
I have used previous year losses (PYA) but I did not have to think about it. It just happens as long as I use the K-1 that Turbotax makes because I import the previous year's return into the current year. I fill in the new numbers (or import as a TXF file for a lot of the numbers) into that form. If you look at column (b) of page 3 of the K-1 in TT, you will see the losses that have been carried forward. Then if you get a positive box 1, the loss will be used to cancel out positive box 1 values for this year without you having to think about it.
I have not yet gone to zero for a capital account balance as far as I ever noticed. So I just let the partnership do the capital account tracking. If I get to zero in either of the capital account numbers, I will start copying the box L numbers from the K-1 into TT regularly, in case that has an effect on tax calculations. I do it intermittently now.
It shows the Ord Income as Non Passive 28 j from all the MLP K1's and Sect 1231 loss as Passive 28g. Seems the total partnership income is the same. I checked last year and it did the same thing. Trying to figure out if I didn't check something or need to check something.