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IRS S Corp ordering rules: 1. increase for income; 2. decrease for distributions; 3. decrease for nondeductible expenses 100%; then 4. decrease for losses and deductions. Items in 4 are allocated pro-rata if insufficient basis.
So why does 1040 ProSeries on K-1 Wks - S Corp add 3 & 4 together then allocate all of them pro-rata when there is insufficient basis? Why doesn't ProSeries Professional correct their computation?
Is there an easier way to handle this rather than override line-by-line-by-line-by-line? This has become more important now that basis statements must be attached. It is a time-waster to have to manually override ProSeries both on this worksheet and on 6198. And we will see more losses in 2020 if the stay-at-home orders and economy don't open up soon. Any suggestions on how to handle this for 2019?