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S-Corp K-1, Box 15, Code B - Adjustment to Section 1250 Gain or Section 1231 Gain?

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September 25, 2023
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I'm entering my S-Corp K-1 details into my personal tax return. Under Box 15, I have losses listed in both Code A and B. In the next screen, TurboTax is asking the following:

Enter the dollar amount of the adjusted gain or loss reported on box 15, Code B of your K-1

Adjustment to Section 1250 Gain _____
Adjustment to Section 1231 Gain _____

I've looked through my S-Corp tax return and I can't find anything in the lines that mention either Section 1250 or Section 1231.

If I leave both boxes blank and move on to the next page, it looks like TurboTax automatically fills in the "Adjustment to Section 1231" box with the loss amount from Box 15, Code B. Is this correct? Or should I put 0 in both boxes? Or something else?

Can someone please advise? Happy to provide any additional details if necessary. Thanks!

TurboTax Self Employed Online

Best answer by Mike9241

you need to leave in 15A and B. these are adjustments for alternative minimum tax purposed 15A flows to 6251 line 2l. 15B can be either 1231 or 1250, or even some of each but it doesn't matter which you use.

from k-1 instructions for 15B

Code B. Adjusted gain or loss. This amount is your share of the corporation's adjusted gain or loss. If you are an individual shareholder, report this amount on Form 6251, line 2k. for various reasons the amount you enter for 15B and what appears on 2k may be different. there is a 6251 worksheet where 2k is calculated.

M

Mike9241Answer

you need to leave in 15A and B. these are adjustments for alternative minimum tax purposed 15A flows to 6251 line 2l. 15B can be either 1231 or 1250, or even some of each but it doesn't matter which you use.

from k-1 instructions for 15B

Code B. Adjusted gain or loss. This amount is your share of the corporation's adjusted gain or loss. If you are an individual shareholder, report this amount on Form 6251, line 2k. for various reasons the amount you enter for 15B and what appears on 2k may be different. there is a 6251 worksheet where 2k is calculated.