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Troubleshooting ProConnect Tax diagnostic ref. #25213 - allocation factor for shareholders doesn't equal 100%

by Intuit Updated 8 months ago

The following critical diagnostic is generating:

Total Allocation Factor for the Shareholders is Not Equal to 100%. You have entered information that is computing a total allocation factor of XXX%. Check your entries for each shareholder in Screen 6 and/ or Screen 7 and adjust as necessary." (ref. #25213)

In prior years, this was diagnostic ref. #25206.

Follow these steps to resolve the diagnostic:

  1. Go to Input Return Shareholder Information Stock Ownership.
  2. Select Details for each shareholder.
  3. Make sure that either:
    • The number of shares owned at End of tax year is correct, or
    • The Percentage of stock owned at year end (xx.xxxxxx) [Override] equals 100%
  4. Go to Input Return Shareholder Information  Change in Stock Ownership.
  5. Make sure that either:
    • The Number of shares owned (-1=none) adds up to the total of Shares entered under Input Return Shareholder Information  Stock Ownership in each period for each shareholder, or
    • The Percentage (xx.xxxxxx)(-1=none) [Override] equals 100% for each shareholder

This diagnostic can also generate due to a rounding issue on a change of ownership. If this is due to rounding, use the Shareholder's ownership percentage (xxx.xxxxx)(Box F of K-1 only) [Override] under Input Return Schedule K-1 Schedule K-1 Misc./Schedule B-1 to enter ownership percentages equal to 100%.

Below is an example of an overstated amount causing the diagnostic to generate:

On Input Return Shareholder Information  Stock Ownership, the following information is entered:

  • Shareholder 1= 100 number of shares owned at End of tax year
  • Shareholder 2= 50 number of shares owned at End of tax year

On Input Return Shareholder Information  Change in Stock Ownership, the following information is entered:

  • Shareholder 1 (Period 1)= 150 Number of shares owned
  • Shareholder 1 (Period 2)= 100 Number of shares owned
  • Shareholder 2 (Period 1)= 50 Number of shares owned
  • Shareholder 2 (Period 2)= 50 Number of shares owned

This diagnostic is generating because the Number of shares owned for period one is overstated by 50. If the total of shares on Input Return Shareholder Information  Stock Ownership = 150 shares, then the total of shares for period 1 must equal 150 and the total of shares for period 2 must also equal 150. In this case, Shareholder 2 (Period 1) should = -1 Number of shares owned. Once corrected, this diagnostic will disappear.

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