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Fiduciary passive loss on rental property not showing on Schedule K-1 in ProConnect Tax

by Intuit Updated 8 months ago

The passive loss on a rental property isn't flowing to the Schedule K-1, Line 7, Net Rental Real Estate Income.

How to override passive activity losses on your Schedule K-1:

Per Form 8582 instructions:

Estates and trusts: the passive activity loss (PAL) limitations apply in figuring the distributable net income and taxable income of an estate or trust...

The program will retain the PAL at the trust/estate (fiduciary) level until the final year of the return or until passive income can offset the losses.

To override the amounts on the beneficiary's Schedule K-1:

  1. From the Input Return tab, go to Sch. K-1  Schedule K-1 Overrides / Misc.  Federal.
  2. Under the Income section, enter the new PAL amount in the field labeled Net rental real estate income (7).
  3. Repeat Steps 3–5 for each beneficiary.

The un-allowed passive loss amount will continue to show on the General Info page generated with the federal forms as a carryover and can't be removed.

ProConnect Tax

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