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thatsenuff77
New Member

If the K1 I received shows a loss, do I need to enter it in this years tax return or wait until I sell the units or get positive activity in a future year?

The K1 shows the loss reducing my cost basis.  Per the K1 instructions if the net result is positive the info should be reported on your 1040:  if negative the loss will be suspended until there are positive returns or you sell the units.  So it's confusing whether I should enter it this year in turbo tax.

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Accepted Solutions
MinhT
Expert Alumni

If the K1 I received shows a loss, do I need to enter it in this years tax return or wait until I sell the units or get positive activity in a future year?

Yes, you should enter the K-1 on your tax return even if it shows a loss.

It is a passive loss. The instructions mean that you are not allowed to deduct this loss from your other income. They are suspended to be used when you have a passive profit or when you sell the units. You cannot use the loss in the future if you do not report it this year.

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8 Replies
1stenger
New Member

If the K1 I received shows a loss, do I need to enter it in this years tax return or wait until I sell the units or get positive activity in a future year?

Why won't turbo tax allow me to file this loss with a IRA I2 block checked?
MinhT
Expert Alumni

If the K1 I received shows a loss, do I need to enter it in this years tax return or wait until I sell the units or get positive activity in a future year?

Yes, you should enter the K-1 on your tax return even if it shows a loss.

It is a passive loss. The instructions mean that you are not allowed to deduct this loss from your other income. They are suspended to be used when you have a passive profit or when you sell the units. You cannot use the loss in the future if you do not report it this year.

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1stenger
New Member

If the K1 I received shows a loss, do I need to enter it in this years tax return or wait until I sell the units or get positive activity in a future year?

Why won't turbo tax allow me to file this loss with a IRA I2 block checked? Is there a way to override?
Rb422
Level 1

If the K1 I received shows a loss, do I need to enter it in this years tax return or wait until I sell the units or get positive activity in a future year?

I have a similar situation, I was given a k-1 for a loss/deduction, on preparation/sale of a small amount of inheritance from property sold with a note that says "for tax year ending may 31st 2019" and told to file with 2019 tax, but on closer inspection it's a 2018 k-1 form. Do I file this with 2018 or 2019, and since I don't report the inheritance as income, does it matter anyways since you said it can't reduce other income..

snarleycharley
New Member

If the K1 I received shows a loss, do I need to enter it in this years tax return or wait until I sell the units or get positive activity in a future year?

I am looking for  the code section, treas reg or any authority whatsoever for the statement "You cannot use the loss in the future if you do not report it this year." Any assistance would be appreciated.  

NS14
Level 1

If the K1 I received shows a loss, do I need to enter it in this years tax return or wait until I sell the units or get positive activity in a future year?

I missed to enter my K1 (loss) on 2019 return. Is there a way for me to reflect that passive loss carry over on my 2020 return directly, or do I need to amend my 2019 return. 

 

Since it is a loss, there would be no tax implication as far as my 2019 return is concerned. 

AmyC
Expert Alumni

If the K1 I received shows a loss, do I need to enter it in this years tax return or wait until I sell the units or get positive activity in a future year?

@NS14 You should amend your 2019 to show how you got the carryover. However, you are allowed up to $3,000 in passive losses as an offset to income. Unless you have already used it, you could have a reduction in taxable income for 2019. Which would mean a refund.

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KCash77
Level 1

If the K1 I received shows a loss, do I need to enter it in this years tax return or wait until I sell the units or get positive activity in a future year?

Amy,

   Aren't you talking about $3000 in Capital Losses?

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