User's Manual - Drake Software

Drake Software User’s Manual
Supplemental Income
income data, if any, goes to Form 8582, Passive Activity Loss Limitations. Available
activity types are described in Table 5-3.
Table 5-3: Activity Type Selections, for K1P, K1F, K1s, E, and 4835 screens
Activity Type
A - Active rental real estate
B - Other passive activity
C - Real estate professional
D - Not a passive activity
Description
Activity is a rental real estate activity with active participation.
Calculation flows to the “Rental Real Estate Activities With
Active Participation” section in Part I of Form 8582 and to the
WKS 1 worksheet. (This is the default for screen 4835.)
Activity is a passive activity but is not a rental real estate
activity. Calculation flows to the “All Other Passive Activities”
section in Part I of Form 8582 and to the WKS 3 worksheet.
Activity is that of a real estate professional and does not flow
to Form 8582.
Activity is not a passive activity. Because it is nonpassive,
the calculations from this screen do not flow to Form 8582.
(Option available on screens K1 and E only.)
If A or B is selected, the activity is considered a currently passive activity because “A”
is rental real estate and “B” is other passive activity.
NOTE
If the General partner box is marked on the K1P screen, self-employment
income is automatically reduced by any amount entered in the
Section 179 deduction field. The unreimbursed partnership expense
flows to a separate line on Part II of Schedule E.
State K-1
Amounts
(If Different)
In cases where the state K-1 amounts differ from federal K-1 amounts (such as when a
state does not take the federal limits on depreciation), indicate the difference in the
software so the correct K-1 amounts will flow to the correct federal and state forms.
By default, the program uses the federal K-1 amounts for both federal and state calculations.
If the state K-1 amounts differ from the federal, enter the state amounts in the
State column fields of a K1 screen (Figure 5-27).
Figure 5-27: Some of the Federal and State K-1 columns from screen K1S
Multiple
States
In some cases, an entity will issue Schedule K-1 forms for multiple states, requiring
the preparer to enter two or more amounts for the same state K-1 items.
To enter federal and state K-1 information where multiple state K-1s are issued:
Tax Year 2012 125