if a partner in a partnership has ordinary business losses on his K-1 , but his basis in the partnership is negative. When i enter his K-1 on his 1040, is Proseries software has a place to enter partner's basis and to automatically disallow the losses .

[Ismail9491]

If a partner in a partnership has a K-1 with ordinary business loss, but his basis in the partnership is negative. When i enter his K-1 to his 1040. Is pro series software has a place on the 1040 to enter the negative basis and automatically disallow the losses for the year? Or do i have to keep track of the basis

in the partnership and report the losses on his 1040 only to the extent the basis allow

[TaxGuyBill]

ProSeries does not have a way to limit losses due to Basis.

Only enter the allowable losses, and then manually keep track of unallowed losses to be carried forward.

[jeffmcpa2010]

In part II of the K-1 entry worksheet there is a quickzoom box to form 6198 to enter at-risk limitation information. That "should" do it. (Haven't tried one for a while with that situation so no guarantees)

[TaxGuyBill]

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@jeffmcpa2010 wrote:

In part II of the K-1 entry worksheet there is a quickzoom box to form 6198 to enter at-risk limitation information. That "should" do it. (Haven't tried one for a while with that situation so no guarantees)

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Those are for At-Risk limitations, not Basis limitations.  Form 6198 should not be filed for Basis limitations.

[jeffmcpa2010]

Part II and Part III of 6198 start out by asking for your basis.

IF Basis is 0 it will limit losses.

If you have no basis you are considered "not  at risk" and 6198 is required and will limit the losses.

I disagree with your conclusion, but we may have to agree to disagree on this one.

[IRonMaN]

It gets to the right bottom line so sometimes you just need a little duct tape and a pair of scissors to get ProSeries to work like you want it to.

[TaxGuyBill]

There are three separate limits, in this order:  Basis, At-Risk, and Passive.

If Basis is limited, At-Risk does not apply.

[anitacpa1]

I use proseries.  I tried to limit the loss for a partner with a loss & negative basis by entering zero on lines 6,11of part II & III on form 6198.  The loss was still allowed so I overrode the loss on Section C on the K-1 input sheet. 

I suggest that a line be added on the federal carryover sheet to keep track of the disallowed losses for partners or add a worksheet to the K-1 to keep track of the partner's basis.