What's the Meaning of Box 20, Code AG (Gross Receipts for Section 448(c)) on Schedule K-1?

The Box 20, Code AG amount on your Schedule K-1 is reporting your share of the business's gross receipts for Section 448(c) purposes. This doesn't directly impact your personal tax return - you don't need to report this amount anywhere on your 1040. This information is reported to shareholders because it helps determine whether the business qualifies for certain accounting method options. Under Section 448(c), businesses with average annual gross receipts of $25 million or less (adjusted for inflation) for the prior three tax years can use the cash method of accounting instead of accrual, and have other simplified options. The amount is your proportional share of the gross receipts, not an additional income amount you need to worry about. The actual income you need to report from the S-Corp should be shown in other boxes on the K-1.

After struggling with this exact same Schedule K-1 Box 20 Code AG issue last year, I finally found a solution that saved me hours of frustration. I was constantly going back and forth with our company accountant trying to understand what to do with this information. I discovered https://taxr.ai which analyzes your tax forms automatically. I uploaded my K-1 and it immediately explained that this code AG amount is just informational and doesn't impact my personal tax return. It even provided a detailed explanation of Section 448(c) and why this information appears on the K-1. The tool also flagged other items on my K-1 that DID need my attention for personal filing, which honestly saved me from overlooking some important deductions. I'm using it again this year to double-check everything.

Just wanted to update after trying taxr.ai that was mentioned earlier. I was super confused about all the codes on my K-1, especially that Box 20 Code AG gross receipts amount. Uploaded my K-1 yesterday and it immediately clarified that the Section 448(c) amount doesn't go anywhere on my 1040. But what was really helpful was discovering that two other codes in Box 20 actually DID require me to file additional forms I had no idea about! Would have completely missed those. Saved me from what probably would have been an amendment later. Definitely more helpful than the "explanation sheets" my partnership provides that are basically just copies of IRS instructions.

If you're struggling to get answers about your K-1 or other tax questions, I feel your pain! I spent WEEKS trying to get through to the IRS about a similar partnership tax question. Always busy signals or 2+ hour hold times that usually ended with disconnections. Finally found https://claimyr.com which got me connected to an actual IRS agent in under 15 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c The agent confirmed that Box 20 Code AG amounts don't affect personal returns directly but helped me understand some other K-1 entries I was confused about. Got actual clarification from the source instead of guessing or paying my accountant for another hour of their time.

I have to admit I was completely wrong about Claimyr. After my skeptical comment, I decided to try it anyway out of desperation because I needed clarification on several K-1 codes including that Section 448(c) amount. Got connected to an IRS agent in about 23 minutes. The agent confirmed that Box 20 Code AG is just informational and doesn't go on my personal return. But the real value was getting answers about some unusual foreign transaction codes I had in Box 16 that my tax software was handling incorrectly. Ended up saving over $2,100 in taxes by filing correctly! Definitely worth it after spending literal days trying to get through on my own with no success.

Just a heads up for everyone confused about these K-1 codes - while Box 20 Code AG (Gross Receipts) doesn't directly impact your personal taxes, there ARE some Box 20 codes that absolutely DO require action on your part. Don't just assume all those codes are informational! For example, if you have Code V (Section 199A information), that's super important for the qualified business income deduction. Code Z can affect your basis calculations. Code AB might mean you need to file Form 8997. I learned this the hard way last year when I ignored several codes and ended up having to amend my return.

My tax software keeps asking me to enter the amount from Box 20 Code AG but then doesn't seem to do anything with it. Is this normal or is my software messed up?? Using TurboTax Premier if that matters.

Daniel, you've gotten great explanations about Box 20 Code AG being informational only. Just wanted to add one practical tip since you mentioned this is your first year as a partial owner - keep good records of ALL the amounts reported on your K-1, even the informational ones like Code AG. While that gross receipts amount doesn't impact your current tax return, it can be helpful for future reference. If your business grows significantly or if there are questions about the company's accounting methods in future years, having a clear record of these amounts can be useful. Also, since you're new to partnership/S-Corp taxation, I'd recommend creating a simple spreadsheet to track your basis in the business from year to year. Your basis affects how much of any losses you can deduct and impacts the tax treatment when you eventually sell your interest. Many new partners/shareholders don't track this properly and run into issues later. The learning curve is steep but you'll get the hang of it! Congrats on joining the family business.

Daniel, everyone's covered the main point perfectly - Box 20 Code AG is just informational and won't affect your personal tax return at all. Since you mentioned you're doing your taxes this weekend, I wanted to add a quick tip that might save you some time. When you're entering your K-1 information, focus on the boxes that actually generate income, deductions, or credits for your personal return - typically Boxes 1-13 and certain codes in Boxes 14-20. The Section 448(c) gross receipts amount in Box 20 Code AG can be entered if your software asks for it, but don't stress about it since it's purely informational. As a new S-Corp owner, the items that will likely matter most for your personal return are your share of ordinary income/loss (Box 1), any separately stated deductions or credits, and possibly the Section 199A information if your business qualifies for the qualified business income deduction. Good luck with your first year of S-Corp taxation! It gets easier once you understand which K-1 items actually impact your personal filing.

Daniel, you've received excellent explanations about Box 20 Code AG being informational only. As someone who's been dealing with S-Corp K-1s for several years, I wanted to add a practical perspective on what to expect going forward. Since this is your first year as a 25% owner, you'll likely see this same Code AG amount (or similar) every year. It's essentially your proportional share of the business's total gross receipts that the IRS uses to determine if your S-Corp qualifies for simplified accounting methods under Section 448(c). One thing that might be helpful as you get comfortable with K-1s - create a simple checklist of which boxes actually affect your personal return versus which ones are just informational. This will save you time in future years when you're preparing your taxes. Also, since you mentioned your accountant is swamped, consider asking them to provide you with a brief summary of what each code on your specific K-1 means for your situation. Most good tax professionals are happy to do this once during tax season to help educated clients understand their returns better. The learning curve feels steep at first, but S-Corp taxation becomes much more manageable once you understand the basics. Welcome to business ownership!

Daniel, you've gotten excellent advice here - Box 20 Code AG is purely informational and won't affect your personal tax return at all. Since you mentioned being new to S-Corp ownership and feeling overwhelmed, I wanted to share a perspective that might help reduce some of that stress. The fact that you're asking these questions shows you're being appropriately careful, which is great. But don't let the complexity intimidate you too much. Most K-1 items fall into pretty predictable categories once you get familiar with them. For your immediate concern about doing taxes this weekend - you can safely enter that Code AG amount if your software asks for it, but know that it's just being stored and won't change your tax calculation. Focus your attention on the boxes that clearly show income, deductions, or credits (usually Boxes 1-13 and the more obvious codes in the later boxes). Since this is a family business and you're working with an established S-Corp, the K-1 structure probably won't change dramatically year to year. Once you get through this first year and understand what each item on YOUR specific K-1 does, future years will be much more straightforward. Congrats on joining the family business - the tax complexity is worth it for the benefits of business ownership!

Daniel, everyone has covered the Box 20 Code AG question perfectly - it's purely informational and won't impact your personal return at all. As someone who helps people navigate tax complexity regularly, I wanted to add one more resource that might be helpful for your situation. Since you're new to S-Corp ownership and mentioned your accountant won't be available for another week, you might want to check out the IRS's own Schedule K-1 instructions. They have a section specifically explaining each Box 20 code and whether it requires action on your personal return. For Code AG (Section 448(c) gross receipts), the instructions confirm it's reported "for informational purposes" and doesn't generate additional income or require separate reporting on your 1040. The $3.2 million represents your 25% share of the business's total gross receipts, which helps the IRS track whether your S-Corp qualifies for simplified accounting methods. Since you're doing taxes this weekend, focus on the boxes that clearly show income, deductions, and credits (typically Boxes 1-13). The informational codes like AG can be entered if your software prompts for them, but they won't change your tax calculation. Good luck with your first year of S-Corp taxation - it gets much easier once you understand the pattern!

Daniel, you've received fantastic explanations about Box 20 Code AG being informational only - everyone is absolutely correct that this doesn't affect your personal tax return. As a newcomer to this community but someone who's dealt with similar K-1 confusion in the past, I wanted to add one perspective that might help ease your stress. That $3.2 million figure represents your 25% proportional share of the S-Corp's total gross receipts (so the business had about $12.8 million in gross receipts). The IRS requires this reporting to track which businesses qualify for simplified accounting methods under Section 448(c), but it's purely administrative - not additional income for you. Since you're tackling your taxes this weekend, here's a practical tip: if your tax software asks for this Code AG amount, go ahead and enter it, but don't expect to see it appear anywhere else in your tax calculation. It's just being stored for compliance purposes. For your first year as an S-Corp owner, focus your attention on the boxes that show actual income, deductions, and credits that will impact your tax liability. The learning curve feels steep initially, but once you get through this first year and see how your specific K-1 flows through to your personal return, future years will be much more manageable. Welcome to S-Corp ownership - the tax complexity is worth the benefits of business ownership!

Daniel, you've received excellent advice from everyone here - Box 20 Code AG is indeed purely informational and won't affect your personal tax return at all. As someone new to this community who's helped friends navigate similar S-Corp taxation questions, I wanted to offer some additional reassurance. That $3.2 million figure might look intimidating, but remember it's just your proportional share of the business's gross receipts for IRS compliance tracking. Since your family's S-Corp is well-established, this is likely a routine reporting requirement that will appear consistently each year. One thing I'd suggest for future years - keep a simple note with your tax files explaining what each major K-1 code means for your specific situation. This will save you from having to research the same questions next year. You can write something like "Box 20 Code AG - informational only, tracks business size for IRS accounting method rules." Since you're doing taxes this weekend and your accountant isn't available, trust the guidance you've received here. Enter the Code AG amount if your software requests it, but focus your energy on understanding the boxes that actually generate income, deductions, or credits for your personal return. Welcome to business ownership - the first year of S-Corp taxation is always the learning curve, but it becomes much more routine after that!

Daniel, you've gotten comprehensive and accurate answers about Box 20 Code AG - it's purely informational and won't impact your personal tax return at all. As someone who recently joined this community and has been through similar S-Corp confusion, I wanted to add a quick perspective on managing the first-year learning curve. Since you mentioned feeling overwhelmed with all these new tax forms, remember that S-Corp taxation follows predictable patterns once you understand the basics. That $3.2 million Code AG amount represents your 25% share of the business's gross receipts for IRS accounting method tracking - it's essentially administrative data that helps the IRS determine if your S-Corp qualifies for simplified accounting rules. For this weekend's tax preparation, focus on the K-1 boxes that clearly show income, deductions, and credits (typically Boxes 1-13 and obvious codes in later boxes). If your tax software asks for the Code AG amount, enter it, but don't expect it to affect your tax calculation - it's just being stored for compliance. One suggestion for future years: create a simple reference sheet explaining what each code on your specific K-1 means. This will save you from re-researching the same questions annually and make tax season much smoother. Congratulations on joining the family business! The tax complexity feels daunting initially, but you'll find it becomes much more manageable once you get through this first year and understand your K-1 pattern.