My K-1 part 3 box 13 Other Deductions has code AE. The attached explanatory note says it is management fees, but in Check This entry, the only option is other taxes.

Forum|Forum|1 year ago
April 5, 2025
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I would like to enter it under Other miscellaneous itemized deductions but that space is greyed out. I can only type in Other Taxes. How do I solve this?

PatriciaV

Employee

Form 1065 Schedule K-1 Box 13 Code AE reports portfolio deductions, which were formerly deductible by individuals under section 67 subject to the 2% AGI floor. The partnership reports these deductions for partners who are not individuals, as they may be able to report the deductions.

In the case of a taxpayer filing Form 1040, the deduction is no longer allowed.

You have two choices:

Return to the Schedule K-1 topic and delete the amount and the AE code for Box 13.
Return to the Schedule K-1 topic and delete the amount for Code AE.
Run SmartCheck again. When prompted, enter the amount on Line 2 Other miscellaneous itemized deductions.

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dave_ruskinAuthor

I tried option 2. SmartCheck told me to enter a value for Box 13 where I had AE and a blank. After I did that, It asked to enter a value Other Taxes, just like before. I still can't choose any other space to enter a number.

PatriciaV

Employee

Have you checked the Miscellaneous Itemized Deductions Worksheet (a TurboTax form)? When you enter a value for Box 13 Code AE, the amount should appear on Line 16 of this worksheet. Although the deduction is not allowed for federal tax purposes, it may be transferred to your state income tax return.

You can view this worksheet in TurboTax Desktop using Forms Mode. If you're using TurboTax Online, you'll need to print your return, including all forms and worksheets. See How do I get a PDF of my return?

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