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Form 3115, Schedule A, line 1h appears incorrect in Lacerte

by Intuit Updated 11 months ago

On Form 3115, Schedule A, Part 1, line 1h, Lacerte is adding expenses accrued but not paid. However, the IRS Instructions for Form 3115 state that the taxpayer should subtract expenses accrued but not paid.

Why is the program adding expenses accrued but not paid instead of subtracting them?

The program directly outputs anything you input in the Expenses accrued but not paid (Ctrl+E) (code 76) field under the Change in Accounting Method (3115) section on the Change in Accounting Method (3115) screen (Screen 61 - Corporate, Screen 55 - S-Corporate).

You can enter either a positive or a negative number in this field. Enter the amount as a negative amount to reduce line 1h.

How do I get these amounts to flow to the Schedule M-3?

The program doesn't carry this number anywhere on the 1120 or 1120-S.

If you want the amounts to flow to the Schedule M-3 for a Corporate return, you can use the input fields on Screen 39.2, Schedule M-3 Section 481(a) adjustments, Temporary Difference, Permanent Difference or Tax Return Amount (codes 124, 125, or 126)

If you want the amounts to flow to the Schedule M-3 for a S-Corporate return, you can use the input fields on Screen 31.2, Schedule M-3 Section 481(a) adjustments, Temporary Difference, Permanent Difference or Tax Return Amount (codes 124, 125, or 126)

Lacerte Tax

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