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The unallowed loss is being carried to next year

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Review form 8582, page 2, worksheet 6.

You will see that the total loss from the K-1 will not be allowed this year.

Passive Losses can only be deducted from Passive Income. So if there is no other passive income to offset the loss then it will be carried forward to the next tax year.

Go the form 1040 Wkt 3 and enter the carry forward amount in the section with the heading 'Carryovers from 2016 to 2017', line 2. Next year got 1040, line 21 for Other income, link to 1040 Wkt 7 and enter the carry over amount (if not carried forward automatically and if allowed)

Tags: federal,form