Proconnect is treating the depletion deduction as if it is a passive loss. This taxpayer has other passive losses and income the net of which is net positive income.  Yet with the depletion deduction the overall net of passive losses, passive income and the depletion is negative so the depletion deduction is not allowed in full. Based on my research the only limit on the depletion deduction is in 613A(d) which is rule that limits depletion to 65% of income.  This taxpayer has net income far in excess of the depletion deduction.  So this rule should not apply.  I've read the how proconnect calculates depletion suggestions, I've checked the oil and gas check box to have depletion show as negative income of Sch E page 1 and I don't get tangled up in the passive activity loss rules form 8582 but the presentation is odd.  Seems like it belongs on Schedule E page in section III which captures trust income and deductions.