I am filling out my schedule K-1 Form 1065 and line 7 asks for "basis of partnership interest." What do I put there?

[DianeC958]

Your basis in the partnership starts out as the amount you invested into the partnership.  For example you invested $10,000 in the beginning.  Then you add profits from your percentage of ownership and subtract losses and distributions, which reduce your basis.

For example you invested $10,000 in 2017, in 2018 the amount of partnership profit for you was $5,000 and you took a distribution of $2,250, then in 2019 the partnership loss amount for you was $2,000.  Now in 2020 your basis in the partnership is

$10,000 + $5,000 - $2,250 - $2,000=  $10,750.