2022 k-1 causing 2023 taxes to be put on hold

[kprow8357]

In 2022 , a partnership of mine ended.  I did not check the box in turbotax online that said that the partnership was sold.  Now in my 2023 tax return, it will not allow me to file my taxes until a k-1 for 2023 is entered.  What can I do to let turbo tax know that I do not need a k-1 for 2023?  Thanks!

[DoninGA]

Delete the Schedule K-1

Click on Tax Tools on the left side of the online program screen

Click on Tools

Click on Delete a form

[Rick19744]

While your facts are limited, are you sure your 2022 tax return is correct?

If you didn't check the box that the partnership K-1 was final, did you have any suspended losses?

Did you compute your overall gain or loss in the investment and report it on form 8949 and Schedule D?

[kprow8357]

Rick19744,

     Thank you for your response! So first off, I do not think that I filed my 2022 correctly since this k-1 issue is popping up on 2023 turbo tax online.  So I did report the income/loses and tax owed on schedule E of the 2022 return, but not on a schedule D or form 8949 like you mentioned.  This return did not have the checkbox marked as final k-1 and I also did not answer the questions about the dissolution of the partnership.  I didn't understand the question and so at this point I am going to amend my 2022 return to reflect that info.  My next question is: do I have to amend this, wait up to 16 weeks (via US mail) and then turbo tax for 2023 will be updated so that it is not waiting for a 2023 k-1?  Or can I file my 2023 without a k-1 (at this point turbo tax online won't even let me) and then amend my 2022 taxes at the same time?  My concern would be that I would have to wait 1/2 a year to receive my return for this year since I was a a bone head and did answer the right questions in 2022.  Thanks!

[Rick19744]

Follow-up comments:

• 2022
  • Go back into TT to amend the K-1.  I can't tell you how that needs to be accomplished.  Possibly just answering some questions.
  • Indicate that the K-1 is final
  • You don't need to re-input anything from the K-1 since you already have that information in the return
  • TT will ask you questions about liquidating distributions, cost basis, selling price, etc.
  • Hopefully you have maintained a tax basis schedule for this investment as this is critical in determining your overall gain or loss.
  • If there is a distribution on the final K-1, this is your liquidating distribution (or "selling" price).  Do not include this figure in determining your tax basis.  Use this for when TT asks for selling price.
  • TT will then want your tax basis or cost basis (which should not include the final distribution noted above).
  • Once you enter those figures, TT will then compute the overall gain, loss, free up any suspended losses if applicable, and reflect the necessary information on form 8949 and Schedule D.
  • This should take care of 2022.  Since there is limited information, I can't say whether you have any tax due or a refund.
• 2023
  • Here you need to make sure that there are no suspended losses being carried forward since the prior year was not marked final.
  • If there are, you will need to go in and manually delete those and then delete the K-1 as noted in a prior comment.
  • Once those two items are taken care of, you can definitely file your 2023 return
• Partnership tax gets complicated very quickly.  So depending on the $$ involved, you may want to get some assistance from a tax professional, or alternately call TT for some help.