The new Section 7217 reporting requirements for partners of a dissolved partnership. How to fill out Form 7217.

[DaveF1006]

Form 7217, Partner’s Report of Property Distributed by a Partnership, is used by partners to report the basis of property distributed to them by a partnership, whether in a non-liquidating or liquidating distribution. Here’s a brief overview of the new Section 7217 reporting requirements and how to fill out the form. 

1. Who Must File: Any partner receiving a distribution of property from a partnership must file Form 7217. 
2. When to File: Attach Form 7217 to your tax return for the tax year in which you received the distributed property.
3. Separate Forms: Fill out and a separate Form 7217 for each date during the tax year that you received distributed property subject to section 732.
4. Exclusions: Do not file Form 7217 if the distribution consisted only of money or marketable securities treated as money under section 731(c).

Please read this IRS reference source for specific instructions on how to fill out your 7217.

[mellynlee1]

TurboTax Desktop Premier states that I may need to report the Property Distributions from my K-1, and continues to state I need to file this new form 7217 because this is being reported on your K-1 in Box 19, Code C-Other Property.

I do have an amount listed under code C, box 19.

However, I saw your post that states:

1. Exclusions: Do not file Form 7217 if the distribution consisted only of money or marketable securities treated as money under section 731(c).

The K-1 I received is from an LLC (I am a domestic, limited partner) that buys land, and later sells this land. I invested in this LLC by investing $ to help purchase the land. I have now received a final K-1 because the LLC has sold all of the land, the partnership no longer exists, and they sent me a check for the final distribution. Does this qualify as the exclusion since I invested $, and they have now given me $ from my "share" of the sale?

In other words, do I need to file Form 7217?

[PatriciaV]

If you didn't receive title to any property and the final distribution was entirely cash, you would not need to file Form 7217. 

However, the code for Box 19 will need to be changed to "A." You might contact the firm that prepared the LLC return and question the use of Code C for the distribution.