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Level 1
posted Jul 14, 2020 1:04:44 PM

s corporation distribution in excess of basis

I am using TurboTax Premier 2019 and need to report a distribution reported on the shareholder's k-1, box 16 (code d). Using the step-by step approach I entered the distribution for the associated k-1, but I am not seeing any tax impact and there is no Form 8949 or Schedule D being generated. Please help me understand what I may be doing wrong! 

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1 Best answer
Expert Alumni
Jul 14, 2020 4:01:26 PM

The distribution from the partnership is taxable only to the extent it exceeds your adjusted basis in the partnership.  So, if you have sufficient "basis", the distribution is not taxable.  See this section of IRS Publication 541 for the details about the Basis of Partner's Interest.

 

If you need to report a distribution in excess of your basis:

  1. Search for "1099b" and use the "Jump to 1099b" to enter the sale of your investment property.
  2. Click "Add more sales" and answer "No" to the question about if you will receive a 1099-B (wording may be a little different in TurboTax Online, e.g., "type it in myself" instead of import).
  3. For the "What type of investment did you sell" dropdown, choose "Everything else".
  4. For "how you acquired", choose "Other Method" if none of the others apply.

You distribution in excess of the basis is the net proceeds.  The date of sale is the date the distribution was made.  The cost basis is zero.  The date of acquisition is the date your partnership interest was acquired.

1 Replies
Expert Alumni
Jul 14, 2020 4:01:26 PM

The distribution from the partnership is taxable only to the extent it exceeds your adjusted basis in the partnership.  So, if you have sufficient "basis", the distribution is not taxable.  See this section of IRS Publication 541 for the details about the Basis of Partner's Interest.

 

If you need to report a distribution in excess of your basis:

  1. Search for "1099b" and use the "Jump to 1099b" to enter the sale of your investment property.
  2. Click "Add more sales" and answer "No" to the question about if you will receive a 1099-B (wording may be a little different in TurboTax Online, e.g., "type it in myself" instead of import).
  3. For the "What type of investment did you sell" dropdown, choose "Everything else".
  4. For "how you acquired", choose "Other Method" if none of the others apply.

You distribution in excess of the basis is the net proceeds.  The date of sale is the date the distribution was made.  The cost basis is zero.  The date of acquisition is the date your partnership interest was acquired.