Knowledge Base

12275: 1040 - Basis Worksheets

1040 Individual Data Entry

Basis Worksheets in the 1040 Package

Starting in Drake09, basis worksheet calculations are available in the 1040 package for all partners and shareholders. Access to the basis worksheet screens is available by clicking the tabs entitled Basis Worksheet and Basis Worksheet continued at the top of the K1P and K1S screens.

Once the Stock Basis and Debt Basis amounts are entered for a K1S (Partner Basis and Debt Basis for a K1P), the program will track the adjusted basis, limit any losses based on the basis calculation, and carry forward to subsequent years the adjusted basis and any disallowed losses.

  • Non-deductible expenses only get carried forward if the taxpayer has made the irrevocable election to take losses and deductions before non-deductible expenses by checking the box on the K1S screen > Basis Wkst (cont.) tab > Elect to take losses and deductions before non-deductible items.
    • Per the field help: "Mark this box to make the election to decrease basis by losses and deductions before nondeductible items. A shareholder may elect to decrease his or her basis for a share of separately computed items of loss, and non-separately computed loss before reducing the basis for nondeductible, noncapital expenses, and the oil and gas depletion deduction. If the shareholder makes the election, to the extent the nondeductible, non-capital expenses, and the oil and gas depletion deduction exceed the shareholder's basis, these items reduce basis in the following tax year."

Data from the current K1 data entry screens will automatically carry to the “current year losses and deductions" column of the worksheets. In Drake09, any disallowed losses from prior years that should be carried forward must be entered in the Prior-year losses and deductions column on the basis worksheet screens. 

Note: Starting in tax year 2018, the IRS requires a basis computation to be attached to individual returns where the taxpayer is a shareholder in an s-corporation in which specific circumstances are met.  See Related Links for further information. 

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