Typing an eighty-account trial balance into UltraTax CS by hand is a long afternoon and a slow way to introduce typos. There's an import for it, and unlike some import features it's genuinely worth using.
The catch is that it needs a tax code on every line, and producing that column is the actual work.
Where it is
Utilities, then Trial Balance Excel Import. You point it at an Excel file and map your columns.
Don't confuse it with Statement, then Import Spreadsheet. That's a different feature for pulling detail into a specific statement window, either from an Excel file or from whatever you've copied to the clipboard, and it'll ask you which worksheet to use and whether to replace or append what's already there. Useful, but not what you want for a whole trial balance.
The five columns
UltraTax expects to map five things: account number, account description, unit, tax code, and amount.
Account number. UltraTax wants one per line. If the client's trial balance came out of QuickBooks with names and no numbers, you'll need to generate them, and any consistent sequence works since they're identifiers rather than anything meaningful to the return.
Account description. What it says. This is what shows up in detail statements, so it's worth having descriptions a reviewer can read rather than whatever abbreviation the bookkeeper favored.
Unit. Which activity the account belongs to. If the partnership has a single trade or business you can leave this alone, but as soon as there's a rental on 8825 or a second activity, the unit is what keeps their income and expenses apart. Getting it wrong doesn't produce an error, it produces a return where two activities are quietly merged.
Tax code. The number that tells UltraTax which line of which schedule the balance belongs on. More on this below, because it's the whole game.
Amount. The balance. Check your signs before you import rather than after, because correcting a sign convention afterward means going into the return line by line, at which point you've lost the time the import saved you.
The column mapping saves, so the next file laid out the same way imports without repeating the setup.
The tax code column is the actual work
Everything else is mechanical. The tax code is a decision, made once per account, about where on the return that account belongs.
UltraTax publishes the numbers in the Tax Code Diagrams guide for 1065, and you can work through the listing and fill in the column. It works. It's also the least pleasant hour in the process, and it has two problems that don't show up until later.
The first is that a wrong code doesn't announce itself. Put an account on the wrong line and the return still calculates, still balances if the amount is right, and still e-files. You get a number in the wrong place, which is the kind of error a diagnostic will never catch because there's nothing internally inconsistent about it.
The second is that the codes are meaningless to anyone reviewing the work. A spreadsheet column full of numbers tells a reviewer nothing about whether the mapping is right. To check it they'd have to look up each code, which nobody does, so in practice the mapping goes unreviewed.
And then next year someone does it again. If the person who built the codes has left, or just doesn't remember why an account was coded the way it was, the decisions get remade from scratch, sometimes differently, and the comparative gets harder to explain.
What the import does not do
It moves balances onto return lines. That's the scope.
It won't post the depreciation the bookkeeper never recorded. It won't keep the meals disallowance on Schedule M-1 where it belongs instead of halving the expense in your spreadsheet, which would leave the client's financial statements disagreeing with the books. And it won't tell you whether anything foots, because there's no reconciliation in it, no record of what you adjusted, and nothing to give a reviewer.
Which is why the import usually sits next to a spreadsheet holding the adjustments and the book to tax column, rebuilt for every client, every year.
Building the file from a workpaper instead
This is where Ledger IQ fits. You upload the client's trial balance and map each account to an actual line on the return, described the way the return describes it, rather than to a code number. The mapping is a decision a reviewer can read and check, which is the part a tax code column can't give you.
The adjustments happen in the same place. Adjusting entries post against the trial balance with references and show up in the adjustments column, and clicking one shows the balance buildup from unadjusted through the entry to adjusted. Book to tax items post separately as tax journal entries with their own M-1 and M-2 offsets, so the book column keeps matching the client's financial statements while the difference is tracked where Schedule M-1 wants it.
The Working Trial Balance proves every column foots and the income proof walks net income per books through those differences to ordinary business income, which is the figure that should appear on page 1 and in box 1 of every K-1. When that ties, the file you generate for UltraTax carries tax codes that came from a mapping you can defend, rather than from an hour with a code listing.
The mapping is remembered, so next year the client's accounts arrive already categorized and the second year starts from the first year's decisions rather than repeating them.
Producing the tax code column from a mapping you can defend
- Upload the client trial balance as it arrived, without pre-formatting it into import columns.
- Map each account to a return line in the return own language, so a reviewer can read the mapping instead of looking up code numbers one at a time.
- Post adjusting entries with references for what the bookkeeper missed, visible in the adjustments column with the balance buildup behind each one.
- Record book to tax items as tax journal entries with M-1 and M-2 offsets, so the meals disallowance never gets halved in a spreadsheet and the books stay intact.
- Confirm the Working Trial Balance foots and the income proof walks book income to ordinary business income.
- Generate the UltraTax file with the tax codes filled in from that mapping rather than from an hour with the code listing.
- Reuse the mapping next year, so the second year starts from the first year decisions rather than repeating them.
Supports Forms 1065, 1120S and 1120, with exports for Drake, Lacerte and UltraTax CS. The walkthrough is in the UltraTax CS resource guide, and it is free during early access, so you can start at portal.ledgeriq.ai and run this on a live client without a credit card.