8582 Entry for "Prior years' unallowed losses "

[Dean_NomadBooks]

I had a 2022 new customer with Prior years' unallowed losses. I couldn't find any direct entry for the 8582 Par I, line c "Prior years' unallowed losses." My workaround was to create a 2021 prior year return with rental loss to match the 8582. I created 2022 based on 2021 where the "Prior years' unallowed losses" calculation was correct. 

What would be your take on this? 

[PhoebeRoberts · Accepted solution]

I routinely recreate the prior year return for new clients in order to get the carry forward correct. Nothing like trying to clean up the AMT version three years down the line because it got missed on the original setup and the client wasn't initially in AMT!

[BAC219]

Yes this sounds like a great idea but I still to enter the Passive Loss Carryforward for previous year to complete that year which means I am still in the same boat.

[taxmo]

If the passive loss is from rental properties, you enter the prior year unallowed losses info on the "Passive Losses" tab of the rental property input screen in ProConnect.  In most cases, the amount goes in the Regular -> Operating box, and also the AMT -> Operating box.

[BAC219]

The passive losses are from Public Partnerships.  I entered them on the Carryforward Worksheet but they do not flow to form 8582. When I entered my Capital Loss Carryforward on the worksheet the losses did carryforward to Schedule D though. 

[taxmo]

What is the "Carryforward Worksheet"?  I'm not sure if you're saying that's a screen in ProConnect where you can enter data? 

If you have a K-1 for a partnership, you can enter prior year unallowed passive loss on the "Passive C/O" tab for the K-1 in ProConnect. 

[sjrcpa]

Loses from Publicly Traded Partnerships are their own species and do not go on the 8582.

[taxmo]

You're completely right, I wasn't thinking about that! 

PTP losses aren't tracked on 8582 because the losses from a PTP can only offset future gains from the same PTP (not pooled with other passive losses).  You can still enter the past losses on the "Passive C/O" tab, but as long as you checked the "Publicly traded partnership" box for the partnership info, it won't put it on the 8582. 

[BAC219]

If PTP losses are not tracked on the 8582 then where do I put Passive Loss Carryforwards carried forward from the prior year.