How do passthrough loss limitations flow through a 1040 return in CCH Axcess™ Tax or CCH® ProSystem fx® Tax?

The video below explains how passthrough losses can be limited and shows statements with additional details for the calculated amounts flowing through the return in a 1040 using CCH Axcess™ Tax and CCH® ProSystem fx® Tax.  

Passthrough losses entered throughout the return can flow through various forms before actually getting to the Schedule E. 
If a passthrough is subject to the K-1 basis limitation, the at-risk limitation, and the passive activity loss limitation, the losses will first flow to the K-1 Basis Limitation worksheets to either be allowed or disallowed.

The losses allowed on the K-1 Basis Limitation worksheet will then flow to Form 6198 and either be allowed or disallowed for the At-Risk Loss Limitations. Next, any losses allowed on Form 6198 will then carry to Form 8582 for the Passive Activity Loss Limitations.

Lastly, any loss allowed through Form 8582 will carry to the Schedule E Page 2.


  • If the K-1 is not subject to all the items, the loss allowed will flow to the next applicable form down.
  • Once a loss is allowed through a worksheet or form, it will not be subject to that worksheet or form again.


A 1040 return has two 1065 Partnership passthrough K-1s:
  • Partnership 1
    • This partnership is passive.
    • Is subject to basis limitations.
    • Is subject to at-risk limitations.
    • Has a loss.
  • Partnership 2
    • This partnership is passive.
    • Has income.
In this example, the Partnership 1's loss will first flow to the K-1 Basis Limitation > Partnership Basis worksheets. The loss will be allowed to the extent that there is basis. Any loss allowed will carry to the Form 6198 - At-Risk Limitation. Here the loss will be limited to the extent of at-risk basis. Any allowed loss here wil carry to the Form 8582 - Passive Loss Limitations.  
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