1065 Goodwill/Sched D (not portfolio income)

[rblmom12]

Client sold business.  I know that Goodwill goes on Sched D as LT Cap Gain, but am told by a fellow tax professional (using other-than-ProSeries) that I should be able to find a check-box on Sched D in 1065 to indicate that this is not a portfolio sale.  ProSeries directed me to this Accountants Community site.  Anyone have answers on this?  (I've not been able to locate such a check-box in ProSeries.)

[PATAX]

I have had Goodwill sales several years ago not on  1065 but I believe on 1040, but I can never recall seeing what you're stating... Maybe it is changed or maybe I am wrong... maybe take a look at the K1 worksheet and something may be on there that you're looking for..

[sjrcpa · Accepted solution]

"indicate that this is not a portfolio sale"  The point of this is mainly to not subject it to Net Investment Income Tax. Is that a potential issue in this return? Might there be input to say not subject to NIIT?

Or is there an adjustment field for Form 8960 Line 5b? or maybe 5c. 

Or is there investment interest expense? 

EDIT: P.S. I don't use ProSeries but maybe these hints help you find what you're looking for.

[Terry53029]

If it were an asset only sale the goodwill is the amount received over and above the basis in assets, and would be reported on 4797. The gain would be carried to schedule D, and I believe would be subject to the NIT. Need more details to give you a better answer.   

[rblmom12]

8960 hints helped; ty.  Correct re; "...not subject it to Net Investment Income Tax."  (Yes, that's the issue in this return.)

[rblmom12]

Yes, it's an asset sale.

[Terry53029]

Self Created Goodwill (never amortized) or Purchased Goodwill on Purchase of Business (Amortized)?