Reporting Loss in PA for NRK1

[ejdtaxman]

For PA practitioners or those knowledgeable of PA taxes. 

I have a return with a K1 reporting a loss. The taxpayer has material participation. 

He is a PA resident but has a NRK1, as partnership is based in DE. I do not believe a PA return was filed if that matters. 

I cannot get the loss to flow through against his wage income. I have entered his % of profits, losses and capital. I marked material participation in the federal form, if this even matters. 

He is MFJ and total income is about $770k. Is this an income limitation? Is it just that he can't deduct this loss against other types of income? Or is there something I am missing? 

I fear it may be that he can't deduct it at all, but I want to make sure before delivering the return. 

[Dusty2 · Accepted solution]

For PA you cannot deduct a loss in one income category against a loss in another category.  The only way to deduct a loss is to have income from a K-1.

Dusty

[ejdtaxman]

wompwahh. thanks