Which ETP K-1 should I use?

Forum|Forum|7 years ago
June 1, 2019
1 reply
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Two weeks ago I received a K-1 for ETP. Last week I received one from ET. The one from ET includes data for ETP on the Supplemental Data sheet. Which source should I use when entering data for ETP. The FEIN is the same.

Also, I owned ETP until ETE merged with them creating ET. I never owned any USAC or SUN which also show up on the ET Supplemental Data sheet. Do I just ignore them? Thanks

TurboTax Premier Windows

Best answer by nexchap

First, when it comes to ET, you actually now own positions in USAC and SUN (as well as ETP). ET owns a stake in each, and you own ET, so their results are passed back to you. So when you enter ET, you have to create separate K-1s for each sub-entity. There's a couple reasons for this:

The IRS rules on PTPs state that losses from one PTP can't be used to offset income from another. So if you sum across all sub-entities, you can violate that rule. Even though a parent PTP owns the shares of the sub-PTPs on your behalf, you still can't violate that rule.

If the parent sells off one of the sub-entities in the future, you'd be entitled to recognize any prior year suspended losses for that sub-entity. That only works, though, if you've been keeping separate records.

As for the two ETP's, you add them together. The ETP K-1 includes financials from Jan 1 to merger day. The ET sub-K1 includes financials from merger day to 12/31.

nexchap

Answer

Level 9

The IRS rules on PTPs state that losses from one PTP can't be used to offset income from another. So if you sum across all sub-entities, you can violate that rule. Even though a parent PTP owns the shares of the sub-PTPs on your behalf, you still can't violate that rule.

If the parent sells off one of the sub-entities in the future, you'd be entitled to recognize any prior year suspended losses for that sub-entity. That only works, though, if you've been keeping separate records.

As for the two ETP's, you add them together. The ETP K-1 includes financials from Jan 1 to merger day. The ET sub-K1 includes financials from merger day to 12/31.

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