k-1, FORM 1065

[smeistax2@msn.com]

I have a 1065 K-1 and on Line 20, Code AE with $19,107.00. It is coming up as taxable on my computer on Form 4797. I was told by another individual that this is not taxable. Thanks!

[jmcdtax]

See IRS instructions form 8990. Also where is it putting the amount on form 4797?

[TAXNJ]

I have a 1065 K-1 and on Line 20, Code AE with $19,107.00. It is coming up as taxable on my computer on Form 4797. I was told by another individual that this is not taxable. Thanks!

Either as you say “I was told by another individual that this is not taxable” or you can do some reading research for the answer:

Line 20AE – Excess taxable income - Amounts reported in Box 20, Code AE is the excess taxable income determined by the partnership for the purpose of the limitation placed on the partnership’s ability to deduct business interest. See Form 8990, Limitation on Business Interest Expense Under Section 163(j).