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12323: 1065/1120S - DPAD, Form 8903 and K1-8903: Missing Calculations (Drake17 and prior)

1065 Partnership

Form 8903, Domestic Production Activities Deduction (DPAD), is not calculating on my 1065 (or 1120S). Line 11 and some of the following lines are blank.

Partnerships and S Corporations, which are flow-through entities, cannot claim this deduction. The DPAD is available only at the partner/shareholder level. The 1065/1120S software produces a Form 8903, but the software does not complete calculation of the deduction and some fields on Form 8903 remain blank and are intended to be blank.

In some cases the entity may need to provide a K1-8903 to the partners/shareholders by checking the box Print K1-8903... on screen 8903. Selecting the option Print K1-8903... provides a K1_8903 page for each partner or shareholder based on their percentage of ownership. The partner’s K-1 will have code T on line 13, the shareholder's K-1 will have code P on line 12, but no amount will be printed.

Read the Instructions for Form 8903 and screen level help before checking the box. The K1_8903 should only be used when the entity is required to provide more detailed information to the shareholder/partner.

The partners/shareholders must determine individually whether they can claim the DPAD. The deduction is limited by a variety of factors, such as their basis and taxable income, and must be evaluated separately by each partner/shareholder.

Note: The Domestic Production Activities Deduction was repealed for tax years beginning after 2017 by the Tax Cuts and Jobs Act. 

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