Question

I entered U.S. interest from a K-1. It shows up in the right place but Turbotax did not calculate my tax liability for it but lumped it together and used code qDCGTW.

Forum|Forum|4 years ago
March 14, 2022
1 reply
0 views

I should owe tax on the interest but it says I owe no tax because it seems to have calculated in along with long-term capital gains and dividends instead of separately.

TurboTax Premier Online

V

Vanessa A

When you look at your 1040, which line do you see the Interest you reported from the K-1? Is it on line 2b of your 1040? If so, then it is being taxed with your regular income as your regular rate.

Where was it reported on your K-1? Box 5 or box 6c? If it was box 6c, then it would be taxed along with your dividends and long term capital gains. If it was in box 5, then it would be taxed at your regular income tax rate.

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"

T

TobogganAuthor

Hi thank you. Yes the interest from the K1 showed up on line 2b of the 1040. On the K1 it is reported on line 5. So all that is correct but under line 11 of the 1040 it says my tax liability is 0. Line 6 says the method used to Figure tax is QDCGTW. There is nothing about the interest. I’m just concerned about why it says I owe nothing.

VolvoGirl

Employee

Line 11 is your AGI. What is on line 15 and 16 for tax? Do you have other income like wages? Maybe your withholding and credits was enough to cover all the tax.

If you have capital gains or qualified dividends the tax is not taken from the tax table but is calculated separately from schedule D. The tax will be calculated on the Qualified Dividends and Capital Gain Tax Worksheet. It does not get filed with your return.

In the online version you need to save your return as a pdf file and include all worksheets to see it.

For the Desktop version you can switch to Forms Mode and open the worksheet to see it. Click Forms in the upper right (upper left for Mac) and look through the list and open the Qualified Dividends and Capital Gain Tax Worksheet.