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FTD0420
Returning Member

Calculating Basis For Personal Return from LLC K-1

I’m looking for help on figuring what my net gain or loss is for a limited partner LLC that I received a final K-1 (1065) for 2019.  I bought in 2018 and the partnership was closed in 2019.    I am confused on how to calculate the basis, and do I need to make a separate entry for Schedule D.  Also, how does the net long term gain amount on line 9a, which differs from the final distribution, factor in to reporting?  Do I need to manually make the adjustments?

 

I only contributed cash in the first year, but on the final K-1 there is capital contributed during the final year, I assume by the partnership on my behalf, and current year net income, that is not reported elsewhere on the K-1.  I do not know why, perhaps from investments or sale of assets?  Are those numbers used to calculate the basis?  Because those numbers, when added to the carried beginning capital balance zero out.  So…I would have no gain or loss?

 

 

Contributed    200,000

 

2018 K-1

Box 1               -2,180

Box 2               -238,267

Box 19(A)        10,973

Box 20(Z)         -2,180

 

Capital Account From 2018 K-1

 

Capital Contributed During Year        200,000

Current Year Increase (decrease)       -240,447                     

Withdrawals and Distributions           10,973

Ending Balance                                   -51,420

 

2019 Final K-1

Box 2               -1,726

Box 9a             227,637

Box 13(W)       62,080

Box 19(A)        232,750

 

Capital Account From Final K-1

 

Beginning Balance                              -51,420

Capital Contributed During Year        120,339

Current Year Net Income                    163,831

Withdrawals and Distributions           232,750

Ending Balance                                   0

5 Replies
MarilynG1
Expert Alumni

Calculating Basis For Personal Return from LLC K-1

Since we can't see your return in this forum, click this link for info on Partnership Final Distribution that may help you.

 

Otherwise, click this link for info on How to Get a Live Review  and connect with a professional that can view your return.

 

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FTD0420
Returning Member

Calculating Basis For Personal Return from LLC K-1

It is not a review of return I need, but an answer of does the capital contributed during the year, and what I assume is income from property and investments sale, that is reported in Capital account contribute to basis?  Those figures are what zeros the account, which it seems means no gain or loss.

ThomasM125
Expert Alumni

Calculating Basis For Personal Return from LLC K-1

For the most part, your basis would be what you contributed to the venture, plus any income from the investment that you reported on your tax return, less any losses you deducted on your tax return, less any distributions you received. 

 

You can report the gain or loss as follows:

 

1. Find the "Income and Expenses" menu option in your TurboTax program

2. Find "Investment Income" in the list of categories

3. Click on "Stocks, Mutual Funds, Bonds and Other"

4. Work through the program to find "Choose the type of Investment you Sold"

5. Choose the "Everything Else" option in the list of investments

6. Enter the information requested about your sale (date sold, sale amount, etc)

 

The sale amount would be what you received when you disposed of your interest. The cost basis would be your basis as mentioned above.

 

You can review the following article to learn more about how to calculate your basis in a partnership:

 

https://taxmap.irs.gov/taxmap2016/pubs/p541-006.htm

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Rick19744
Level 12

Calculating Basis For Personal Return from LLC K-1

A couple of questions:

  • Do you materially participate in the LLC
  • When you prepared your 2018 return, does it show that you have passive activity loss carryovers
  • When you prepared your 2018 return, did you input the entire amount on the K-1 from box 2
  • Also, on your K-1 section L, what box is checked; tax basis, GAAP, etc
  • For 2019, what was your actual liquidating distribution
  • For 2019, did you actually contribute any additional capital

I just want to understand the 2018 preparation and then will provide some guidance.

*A reminder that posts in a forum such as this do not constitute tax advice.*
FTD0420
Returning Member

Calculating Basis For Personal Return from LLC K-1

  1. I do not participate; all activity is passive.
  2. According to my 2018 return, I have a passive carry over of $-240,447.
  3. Yes, I did enter the entire amount from Box 2.
  4. The K-1 from 2018 has Tax Basis checked, the 2019 final K-1 has no designation.
  5. My final liquidating amount was $229,052.  I do not know why the final K-1 distribution shows $232,750.
  6. I did not contribute any actual capital in 2019.

Thanks, in advance , for your help.

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