How to adjust 1099 cost base for "Current year net loss" from K1

[x_m_z]

Hello,

I traded UNG in 2023, I received both 1099-B and K1. 

In 1099-B, the Box B is checked, sold for $6,486 and cost base was $10,639 (for a loss of $4,153);

In K1:

Beginning: 0

Ending: 0 (bought and sold in the same year)

In L: Capital contributed during the year: $10,640,

         Current year net income (loss): ($3,745)

         Withdrawl and distributions: ($6,895)

Box 5: Interest income $267

Box 6: Ordinary dividends: $65

Box 11-C: Other income:  ($2,738)

Box 11-ZZ: ($1,287)

Box 13-ZZ: $52

Box 20-A: Other information $332

Box 20-AA: $757

I read other threads on this website, I understand that I need to add the "Current year net income(loss)" in K1 to the cost base in 1099-B. In this case, since the "Current year net income (loss)" is a negative amount, so I should change the cost base in 1099-B to $6,894 ($10,639-$3,745)?

Please Help.

Thank you.

[nexchap · Accepted solution]

Any untaxed cash you receive, any non-cash K-1 items that lower your taxes, both lower your basis.  Similarly, any non-cash K-1 items that raise your taxes also raise your basis. 

So as examples:

- The dividends and interest listed (267 and 65) will raise your basis since they raise your taxes.

- The ($2738) straddle loss lowers your taxes, so also lowers your basis.

In theory, all the items on the K-1 would add to the -3745 you see as 'current year net income'.  However, the codes you listed aren't all supported by TT, and I also don't see how the numbers you listed can be combined to equal -3745.  So I wouldn't blindly reduce your basis by 3745 until you've verified that you've actually got tax losses that match that amount flowing elsewhere in your return.  @x_m_z