Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
cancel
Showing results for 
Search instead for 
Did you mean: 
amandabason
New Member

I have a K1 for a bankrupt investment, but's it's only showing a '1' in 'Ordinary business income (loss)'. Shouldn't that represent my full loss amount of my investment?

 
1 Best answer

Accepted Solutions
Rick19744
Level 12

I have a K1 for a bankrupt investment, but's it's only showing a '1' in 'Ordinary business income (loss)'. Shouldn't that represent my full loss amount of my investment?

No.

You should be maintaining a basis schedule of your investment in this activity.  This begins with your original capital contribution and is updated annually for the applicable lines on your K-1.

Once you update your basis schedule for the final K-1, you will then have the information to determine if you have an overall gain or loss on this investment.  This gain or loss is then reported on Schedule D and the applicable form 8949.

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

View solution in original post

1 Reply
Rick19744
Level 12

I have a K1 for a bankrupt investment, but's it's only showing a '1' in 'Ordinary business income (loss)'. Shouldn't that represent my full loss amount of my investment?

No.

You should be maintaining a basis schedule of your investment in this activity.  This begins with your original capital contribution and is updated annually for the applicable lines on your K-1.

Once you update your basis schedule for the final K-1, you will then have the information to determine if you have an overall gain or loss on this investment.  This gain or loss is then reported on Schedule D and the applicable form 8949.

*A reminder that posts in a forum such as this do not constitute tax advice.*
Dynamic AdsDynamic Ads
Privacy Settings
v