Passive-Activity Business Credits

[GLJEANNE]

I was going around in circles yesterday with this return, with the software and I coming up with different results each time. If anyone who deals with these could check me, I'd be grateful.

TP has $3500 of passive-activity business credits - ethanol and low-income housing, but almost no taxable income this year. $200 of credits are allowed, but not actually used, because education credits take first priority and use up all the tax.

So bottom line of Form 3800 is zero (which sadly makes it unable to e-file, sigh!). But how much is carried forward to next year - $200 or $3500? I'm saying the full $3500, the software is going back and forth between zero and $200.

I hate this guy's return! Usually he has enough passive income to make it all allowable, this was an odd year. But the whole back and forth between forms 8582, 8582CR, 8586, 6478 and 3800 drives me nuts!

[GLJEANNE]

Anyone? I sure could use another set of eyes on this.

[RJM]

Maybe try to discard the 3800 form and then re-add it. The back-and-forth problem you describe sounds like a recursive calculation bug in the spreadsheet (Excel and most other spreadsheets have a bug in this area). Initiating the bug could be caused by a stray entry in the spreadsheet (the 3800 form) somewhere. I agree that the 3500 sb carried forward. You can always override the form cells. In prior years this form had occasional odd problems, but the last couple years it seems to be doing what I expect it to do.

[GLJEANNE]

Thank you!! That seems to have done the trick; it now shows the full carry-over without my having to force things.

Now, if only I could efile the dang thing. Why is it always the returns with 20 pages that you have to mail in! :rolleyes: