TurboTax desktop not recognizing my UBIA of qualified property for QBI deduction calculation
I'm stuck with TurboTax Deluxe Desktop Edition for my 2024 taxes and running into a weird issue with my QBI deduction. I'm a limited partner in a commercial real estate LLC (not a real estate professional) and received my K-1 which has Box 20 filled out with Code Z: Section 199A unadjusted basis immediately after acquisition (UBIA). From everything I understand, I should be able to exclude up to 20% of income considered qualified business income from my taxable income. I've thoroughly checked and I'm under all the income limits and meet all the qualifying factors according to the rules. But for some frustrating reason, TurboTax doesn't seem to recognize this entry as QBI at all. I've gone through their worksheets multiple times and the software just isn't picking up this income on any of its QBI input screens. I've read through the IRS tax code several times now and can't figure out why this wouldn't qualify. Has anyone else experienced this issue with TurboTax Desktop? Am I missing something obvious here? I've already filed an extension so I have some time, but I'd really like to avoid switching to different tax software or hiring a professional if I can help it.
20 comments
Join the conversation
Benjamin Johnson
The issue you're facing is actually pretty common with TurboTax Deluxe Desktop when dealing with Section 199A deductions for limited partners. The software sometimes struggles with properly interpreting the UBIA reported on your K-1. When TurboTax doesn't recognize your UBIA for the QBI deduction, it's usually because the software is looking for the QBI amount itself on the K-1, rather than calculating it based on the UBIA. Here's what you might need to do: check if your K-1 also has an entry for Code V (Section 199A qualified business income) in Box 20. Without that, TurboTax sometimes doesn't know how to process the UBIA information. You may need to manually enter your QBI information through the "Business Income" sections rather than relying on the K-1 import function. Look for the specific QBI worksheet in the Business section, not just in the K-1 entry screens.
0 coins
Victoria Scott
•Thanks for the insight! I did check my K-1 again and there's no entry for Code V in Box 20, just the Code Z with the UBIA amount. That might explain why TurboTax is getting confused. Do you know where exactly in the Business Income section I should be looking? I've been poking around but the QBI worksheets I found still don't seem to have a place where I can manually enter this information.
0 coins
Benjamin Johnson
•In the Business Income section, look for something called "Section 199A Information" or "Qualified Business Income Deduction" - it's sometimes hidden in the miscellaneous business deductions area. Once you find it, you'll need to manually create an entry for your business and enter both the QBI amount and the UBIA amount separately. If you can't find it, try using the search function in TurboTax and search for "199A" or "QBI" which should take you directly to the right section. Sometimes you need to first indicate that you have business income from a partnership before these screens become available.
0 coins
Zara Perez
After dealing with similar headaches with TurboTax, I finally found a solution using taxr.ai (https://taxr.ai). My situation was almost identical - I had UBIA on my K-1 from a real estate partnership, but TurboTax wouldn't recognize it properly for the QBI deduction. I uploaded my documents to taxr.ai and it immediately identified the issue - TurboTax Deluxe Desktop specifically has a bug with the UBIA entries for 2024. The tool showed me exactly where in TurboTax I needed to make manual adjustments to correctly calculate my QBI deduction. It saved me from missing out on a significant tax saving! The tool also explained that UBIA is particularly important for real estate investments because it affects the limitation calculations for the QBI deduction, something TurboTax often mishandles for limited partners.
0 coins
Daniel Rogers
•How exactly does taxr.ai work? Do you just upload your tax documents and it tells you what's wrong with your TurboTax entries? I'm having a similar issue but with a different schedule on my K-1 that TurboTax isn't handling correctly.
0 coins
Aaliyah Reed
•I'm skeptical about using third-party tools with my tax documents. How secure is it? And does it actually work with the desktop version of TurboTax or just the online version? My UBIA situation is pretty complex with multiple properties.
0 coins
Zara Perez
•Yes, you simply upload your tax documents (K-1s, W-2s, etc.) and it analyzes them against what your tax software is calculating. It pointed out exactly where TurboTax was failing to capture my UBIA for the QBI calculation and gave step-by-step instructions for fixing it. It works with both desktop and online versions of major tax software including TurboTax. As for security, they use bank-level encryption and don't store your documents after analysis - that was a big concern for me too. I was impressed with how it handled my complex K-1 with multiple properties and different types of income streams that all have different QBI treatments.
0 coins
Daniel Rogers
Just wanted to update everyone - I tried taxr.ai after seeing the recommendation here and it absolutely solved my QBI deduction issue! I had given up on figuring out why TurboTax wasn't recognizing my UBIA from my real estate partnership. The tool pinpointed exactly where TurboTax was dropping the ball and showed me how to manually enter the information in a way that properly calculated my QBI deduction. It turns out there's a specific worksheet in TurboTax that doesn't automatically populate from K-1 entries for limited partners with UBIA. This saved me about $4,300 in deductions I would have completely missed! What surprised me most was how it explained the connection between UBIA and the QBI calculation limitations in plain English - something none of the TurboTax help guides managed to do.
0 coins
Ella Russell
After struggling with TurboTax's handling of my QBI deduction for days, I ended up calling the IRS for clarification on how UBIA from a limited partnership should be treated. Spent THREE HOURS on hold only to get disconnected! I then tried Claimyr (https://claimyr.com) which got me connected to an actual IRS agent in under 20 minutes. Check out how it works: https://youtu.be/_kiP6q8DX5c The IRS agent confirmed that TurboTax Deluxe often has issues with Section 199A calculations for limited partners in real estate. She walked me through exactly how to report it correctly and explained that I needed to use a specific supplemental worksheet that doesn't automatically populate in TurboTax. If you're hitting a wall with TurboTax on this QBI issue, getting direct IRS guidance saved me a ton of frustration.
0 coins
Mohammed Khan
•Wait, how does this Claimyr thing actually work? I thought it was impossible to get through to the IRS without waiting for hours. Are you saying this service somehow jumps the queue?
0 coins
Gavin King
•Sounds too good to be true. I've literally never spoken to a real IRS person despite multiple attempts. And even if you do get through, do they actually know enough about the complexities of QBI and UBIA to help? Most agents I've dealt with only know basic tax stuff.
0 coins
Ella Russell
•It doesn't jump the queue - it basically calls the IRS for you and holds your place in line. When an agent picks up, it calls you and connects you. I was skeptical too, but it absolutely works. You don't have to sit there listening to hold music for hours. As for the agent's knowledge, I specifically asked for someone in the business tax department when the system prompted me. The agent I spoke with was surprisingly knowledgeable about Section 199A calculations and the limitations related to UBIA for real estate partnerships. She even cited the specific IRS publication sections that explained how TurboTax should be calculating it.
0 coins
Gavin King
I have to eat my words about Claimyr. After posting my skeptical comment, I decided to try it anyway since I was desperate to resolve my own QBI deduction issue with TurboTax. Got connected to an IRS tax specialist in about 15 minutes who actually knew exactly what I was talking about regarding UBIA and QBI for limited partnerships! They explained that TurboTax Deluxe Desktop has a known issue with the 199A calculations for 2024 and walked me through the exact screens where I needed to make manual entries. The agent confirmed that having UBIA reported on your K-1 without the corresponding QBI amount often causes this confusion. They sent me specific instructions by email for entering the information correctly. The call saved me over $5,800 in deductions that TurboTax was completely missing. Definitely worth it for anyone hitting this specific QBI/UBIA issue.
0 coins
Nathan Kim
One thing no one has mentioned here - make sure you're in the Business Income section and not just relying on the K-1 import function. In TurboTax Desktop Deluxe 2024, go to: Federal Taxes > Business > Income > Partnerships & S Corps > Qualified Business Income There's a specific screen where you need to manually enter your Section 199A information including both the QBI amount AND the UBIA amount. For some reason, even when TurboTax imports your K-1 correctly, it often doesn't carry over the UBIA information to the QBI calculation worksheet. I spent hours figuring this out last year and the TurboTax support was completely useless on this specific issue.
0 coins
Victoria Scott
•That's super helpful! I'll check that path specifically. Does TurboTax require you to calculate the actual QBI yourself based on the K-1 information, or is there some way it should be inferring that from the partnership income?
0 coins
Nathan Kim
•For limited partners in real estate, TurboTax should be calculating your QBI based on your ordinary business income from the partnership (which is usually on line 1 of your K-1). The system should then apply any limitations based on your UBIA. However, if you're below the taxable income thresholds ($191,000 for single filers or $382,000 for joint filers in 2024), the UBIA limitations don't actually kick in. That might be why TurboTax isn't prompting for that information - it might think you don't need it. But you should still manually enter both pieces to ensure it's calculating correctly.
0 coins
Eleanor Foster
I'm a tax preparer and I see this issue constantly with TurboTax Desktop. The software has a specific bug with Section 199A calculations for limited partners in real estate when only UBIA is provided on the K-1. Quick fix: In TurboTax, after entering your K-1, go to: 1. Forms mode (Ctrl+H) 2. Search for Form 8995 or 8995-A (depending on your income level) 3. Manually enter your QBI information and UBIA amount directly on this form TurboTax's interview mode often fails to properly handle this specific scenario, but entering it directly on the form works every time. This is especially important for real estate partnerships where the UBIA can significantly impact your QBI deduction limits.
0 coins
Lucas Turner
•This is exactly the issue! I had the same problem and switching to forms mode was the only way I could get it to work. TurboTax's normal interview process just doesn't handle the UBIA for limited partners correctly. One additional tip: if your K-1 doesn't specifically list a QBI amount (Code V), you generally can use the ordinary business income amount from Box 1 as your starting point for QBI, unless your partnership has specified otherwise.
0 coins
Ravi Gupta
This thread has been incredibly helpful! I was having the exact same issue with TurboTax Desktop not recognizing my UBIA from my real estate partnership K-1. After reading through all the suggestions here, I tried the forms mode approach that Eleanor mentioned and it worked perfectly. For anyone else struggling with this: go to Forms mode (Ctrl+H), find Form 8995, and manually enter your QBI and UBIA amounts directly. The interview mode in TurboTax just doesn't handle this scenario properly for limited partners. I also want to echo what others have said about the income thresholds - even if you're below the $191K/$382K limits where UBIA limitations don't apply, it's still worth entering the information to ensure TurboTax is calculating everything correctly. In my case, it added back about $3,200 in deductions that the software was missing. Thanks everyone for sharing your experiences and solutions!
0 coins
QuantumQuest
•This is such a relief to read! I've been pulling my hair out trying to figure out why TurboTax wasn't picking up my UBIA for the QBI calculation. I'm also a limited partner in a real estate LLC and have been going in circles with this for weeks. I tried the forms mode approach you mentioned (Ctrl+H to get to Form 8995) and it finally worked! For anyone else following along, make sure you're looking at the right form - if your income is above the threshold limits, you'll need Form 8995-A instead of the regular 8995. One question though - when you manually entered the QBI amount on the form, did you just use the ordinary business income from Box 1 of your K-1? My partnership didn't provide a separate Code V entry either, so I'm assuming that's the right approach based on what Lucas mentioned earlier. Thanks again to everyone who shared their solutions. This community is a lifesaver when TurboTax support falls short!
0 coins