How can we make the election in Lacerte to use the 199A proposed regs from 8/16/18 as opposed to the final regs in Lacerte (an option offered in the final regs)?

Forum|Forum|6 years ago
December 7, 2019
1 reply
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Proposed regs issued on 8/16/18 say nothing about adding back adjustments such as S/E health, retirement, and 1/2 of S/E tax to arrive at QBI, as the final regs do. The final regs give the option of relying on the 8/16/18 version of rules or the updated rules which contain adding back the adjustments. During tax planning we were not aware that this change would be occurring, so we would like to "opt out" of the final regs as allowed in the final regulations for 2018.

Lacerte Tax

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Best answer by TaxGuyBill

I suspect you would need to override.

However, that is a stretch. Although the Proposed Regulations did not specifically state to reduce QBI by those items, both the Code and the Proposed Regulations state that items of "qualified items of income, gain, deduction, and loss" reduce QBI. So although those three items were not specifically mentioned, it definitely seems to me that it was indirectly covered.

Also, the Code and Proposed Regulations then list some items that are NOT included in "qualified items of income, gain, deduction, and loss" to reduce QBI, but those three deductions are also not listed under the exceptions.

T

TaxGuyBillAnswer

Level 15

I suspect you would need to override.

However, that is a stretch. Although the Proposed Regulations did not specifically state to reduce QBI by those items, both the Code and the Proposed Regulations state that items of "qualified items of income, gain, deduction, and loss" reduce QBI. So although those three items were not specifically mentioned, it definitely seems to me that it was indirectly covered.

Also, the Code and Proposed Regulations then list some items that are NOT included in "qualified items of income, gain, deduction, and loss" to reduce QBI, but those three deductions are also not listed under the exceptions.

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