2017 ProSeries/1120S ReadMe

Version: 2017.110 / August 31, 2018

Click a link to go directly to the topic of your choice:

All 1120S Forms can be filed

Items addressed in this release of ProSeries

Items addressed in previous releases of ProSeries/1120S

What's new in ProSeries/1120S

New ProSeries/1120S forms

Tax legislation issues

Electronic Filing

Items addressed in this release of ProSeries/1120S

The following issues have been fixed in this release:

• Added Section 965(a) inclusion on Form 1120-S, page 3, Schedule K, Income (Loss), line 10, Other income (loss), line A.
• Form 3468, Part II and III were not allowing manual entry. This has been fixed in this release.
• The Depreciation Options Worksheet has been updated for Connecticut 100% Bonus Depreciation Nonconformity to the Tax Cuts and Jobs Act of 2017.
• Client Analyzer was added to Connecticut Composite Income Tax Return to allow you to run a query to determine how many of your returns maybe affected. To access, go to HomeBase and under Homebase View, select Client Analyzer Queries. Select Return Type - 1120 S-Corporation. Select GO to run the query. A list of returns affected will display.

Items addressed in previous releases of ProSeries/1120S

• The Depreciation Options Worksheet has been updated for Connecticut 100% Bonus Depreciation Nonconformity to the Tax Cuts and Jobs Act of 2017.
• Deductions and Credits Extensions - many deductions and credits were extended for 2017, including certain credits on Forms 6478 and 8903.
• Form 5884-A, Credits for Affected Disaster Area Employers - for guidance on how to enter and attach this form, use Where Do I Enter in ProSeries.
• Schedule K-1, line 13 was not allowing credit codes U and V. This has been fixed in this release.
• Form 4562 Depreciation Reports - the reports has been fixed to print with more descriptive titles.
• Tax Cuts and Jobs Act of 2017 - Form 4562
• Bonus First-Year Depreciation Deduction: Calculations updated for a return that includes asset(s) that are affected by the 40% phase down of bonus depreciation for qualified property placed in service in 2018 and acquired before September 28, 2017.
• Enhanced First-Year Depreciation Cap on Luxury Autos and Trucks: Calculations updated for a return that includes auto or truck asset(s) placed in service in 2018 that is affected by the increased auto and truck limits.
• Certain Farm Machinery and Equipment 5-Year Recovery Period: Calculations updated for a return that includes certain farm machinery and equipment (Asset Type E2) placed in service in 2018.
• Required Use of 150% Declining Balance Method for Farm Property: Calculations updated for property with a 3, 5, 7, or 10 year asset class
• Removal of Computer Equipment from Listed Property: Calculations updated for computer equipment (Asset Type A) placed in service in 2018. It is not listed property.
• Qualified Improvement Property: Calculations updated for a return that includes Qualified Retail Improvement, Qualified Restaurant, and Qualified Leasehold Improvement property (Asset Types J2, J3 and J4) placed in service in 2018 to allow changing the recovery period for these assets from a 15-year to a 39-year recovery period.
• Removed Form 4562 diagnostics on:
• Bonus First-Year Depreciation Deduction for a return that includes asset(s) that may be affected by the 40% phase down of bonus depreciation for qualified property placed in service in 2018 and acquired before September 28, 2017.
• Enhanced First-Year Depreciation Cap on Luxury Autos and Trucks for a return that includes auto or truck asset(s) placed in service in 2018 that may be affected by the increased auto and truck limits.
• The Depreciation Options Worksheet has been updated for Alabama and Oregon 100% Bonus Depreciation conformity to the Tax Cuts and Jobs Act of 2017.
• Form 4562, Depreciation and Amortization, Identifying Number not printing the 9 digit number is fixed.
• Calculations supporting Special Depreciation Allowance Type V assets have been added to the program.
• Added new Special Depreciation Allowance Election under IRC Section 168(k)(10)
• Special Depreciation Allowance Elections under IRC Section 168(k)(5), IRC Section 168(k)(7), and IRC Section 168(l)(3)(D) not printing the statement has been fixed.
• The Special Depreciation Allowance Election under IRC Section 168(k)(10) can be attached as a pdf on an electronically filed return.
• Form 8903, Domestic Production Activities Deduction Worksheet is final
• Shareholder's Installment Sale Report for Assets with Section 179 Expense amounts not printing is fixed.
• Added new Two Year Projection Worksheet
• Added Form 8824 diagnostics on Tax Cuts and Jobs Act of 2017: Like-Kind Exchange Treatment Limited to Real Property: Nonrecognition of gain or loss under section 1031 is limited to the exchange of real property after December 31, 2017, that is held for productive use or investment only. Property located inside the United States and property outside the United States are not property of a like kind. If you reported an exchange on Form 8824, verify that it qualifies for nonrecognition of gain under the new like-kind exchange rules, including trade-ins of automobiles.
• Tax Cuts and Jobs Act of 2017 - Blended Tax Rates: Schedule D, Part III,Line 21 calculates the tax using the blended tax rate for corporations filing fiscal year return or short year return ending in 2018. The IRS has issued updated draft instructions which have been implemented into Schedule D. However, the Final instructions have not been received; therefore, if you file the return, there is the potential that calculations could change and that you may need to file an amended return when the final instructions are received.
• Form 6765 updated for fiscal year filers. Fiscal year taxpayers use the weighted average of the highest corporate rates before and after the change to make the reduced credit election.
• Form 6765 instructions updated with tax rates for fiscal year filers.
• Schedule D instructions updated with built-in gains tax rate for fiscal year filers.
• The Bipartisan Budget Act of 2018 restored many items that expired after 2016. Included in this release are:
• Form 4562, Extension of acclerated depreciation for business property on an Indian reservation.
• Form 4562, Extension of special depreciation allowance for second generation biofuel plant property.
• Deductions and Credits Extensions - many deductions and credits were extended for 2017, including certain credits on Forms 4136, 6478, 8835, 8844, 8845, 8903, and 8910.

What's new in ProSeries/1120S

For information on what's new in ProSeries/1120S, open an 1120S return, go to the Help menu, select Help Center, then select What’s New This Year?

New ProSeries/1120S forms

We've added the following form to ProSeries/1120S for the 2017 tax year:

Two Year Projection Worksheet

Special Depreciation Allowance Election under IRC Section 168(k)(10)

Form 4684, page 4, Casualties and Thefts, Section D -- Election to Deduct Federally Declared Disaster Loss in Preceding Tax Year

Tip: For information about changes to existing forms, start or open a Form 1120S return, go to the Help menu, select Help Center, then select What's New This Year?

Tax legislation issues

For information on tax legislation issues, open a 1120S return, go to the Help menu, choose Help Center, then select What's New This Year?

Disaster Relief and Airport and Airway Extension Act of 2017

Highlights of the Disaster Relief and Airport and Airway Extension Act of 2017, providing relief to victims of Hurricanes Harvey, Irma and Maria, include:

• Casualty losses
• The Act provides relief for taxpayers that suffered disaster losses.
• Form 4684, page 4, Schedule D Election to Deduct Federally Declared Disaster Loss in Preceding Tax Year
• The Act increases the $100 floor per casualty to $500

Charitable Contributions

• Qualified contributions were made between August 23 and December 31, 2017, in cash, for Hurricane relief efforts
• Such contributions are not subject to the charitable contributions limitations

Electronic filing

Electronic filing is available in this release of ProSeries/1120S.

For electronic filing procedures and information, click the EF button on the toolbar to go to the EF Center (also known as the HomeBase Electronic Filing view).

The Steps to E-File section on the right side of the EF Center summarizes the steps that you take when you file a client's return(s) electronically. In the Steps to E-File section:

• Click a step to see detailed information in the ProSeries User's Guide.
• Click a button to see more information about electronic filing.
• To perform electronic filing functions, select the E-File Now button on the toolbar to e-file the currently open return or go to the EF Center and highlight all of the returns you want to e-file. Next, go to the E-File menu, select Electronic Filing, then select the appropriate command from the Electronic Filing menu.

The commands on the Electronic Filing menu in ProSeries are:

• Convert/Transmit Returns and Extensions
• Receive Acknowledgment Statuses
• Update Acknowledgment Status of Selected Returns
• Electronic Filing Reports
• Correct Duplicate DCNs
• Options

Tip: A quick way to select the Convert/Transmit Returns and Extensions command is to click the E-File button (to the right of the EF button on the EF Center toolbar).