NOL and K-1

Forum|Forum|4 years ago
April 13, 2022
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I was waiting on the K-1 (Form 1065) to arrive so I completed all other tax inputs to the TT Premier (2021 tax year). I have a NOL carryover from 2020. I inputted the amount on the "2020 Net Operating Loss" page of the software. That immediately eliminated all that was due to IRS. When I received the K-1, I started to input the data on the "Schedules K-1 or Q" page of the software. When I got to the page "Enter Box 1 Info" and entered the data, I immediately owed Federal taxes. I removed all data from the "Schedules K-1 or Q" along with the NOL figure from the "2020 Net Operating Loss". I then re-inputted the data for "Schedule K-1 or Q" first and then the NOL data, and again it showed I owed that same amount.

I need an explanation of why my NOL carryover is not eliminating all of the amounts due to the IRS.

Thanks in advance,

ThomasM125

The most likely reason is that the net operating loss is less than your income in 2021. For instance, if your NOL was $50,000 and you entered $50,000 of income before you entered the K-1 then the K-1 income would give you positive income in 2021 and that could result in you owing tax.

You can look at your form 1040 and schedules 1 to 3 to see if your NOL is being properly listed on line 8(a) of schedule 1 and to see your income reported on form 1040.

You can view your form 1040 while working in the online version of TurboTax by following these steps:

While working on your return in the Federal section of TurboTax:

1. Choose the Tax Tools icon on your left menu bar

2. Tools

3. View Tax Summary

4. Choose the Preview my 1040 on your left menu bar

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