Pro Series QBI and 179 expense

On Pro Series 1120S returns the program is not subtracting the 179 expense from ordinary business income to compute the QBI deduction.


Is anyone else having this problem?


How are you correcting the problem?


Thanks

My understanding is that this isn't a glitch. It's because until you know what the 179 allowed on the 1040 is, you can't adjust. It's properly adjusted on the 1040 from what I've read.

Thanks JR1. Just did a 1040 and it did not take out the 179 when computing the QBI.

I guess I need to look around in the program. I must be missing a box or something to check

So much to figure out....*sigh* I see another longer thread, might see if this is addressed in there.

I just imported a K1 into a 1040 in UltraTax, and it is doing nothing with Sec. 179 relative to indicated QBI. In other words, QBI is what is indicated on K1 and on the 1120S, and the Sec. 197 deduction is correctly showing up on Tab K1-3, Box 11. Ok, makes sense since each individual is subject to limitations.

The software is acting strangely. Initially, it was removing the 179 deduction on 4562 due to zero shareholder stock basis. It then started to include it, but still NO adjustment to QBI. Deduction remains the same under both scenarios.

I'm forcing QBI on all my returns. Not trusting the software AT ALL.

Will it take more time? The first few, sure...but not after a couple.

Bottom line, my job is as a tax preparer, not a software data entry technician.

My software is not making any deduction for Section 179 at either the entity level or individual level. I think it is a gray area as to what the correct QBI number should be on the K-1. Should it be income less the separately stated items, or income before the separately stated items (ie, section 179 or charitable contributions). It appears software is handling this differently and no one knows exactly what should be shown. We have had guidance on how to calculate QBI, but none on how to report it on the k-1.

The practitioners I have spoken with have different opinions. Bottom line, don't just pick up the QBI number off of the K-1 without first determining what exactly is included in that number! It may or may not already include separately stated items.