K-1 Reporting

Forum|Forum|5 years ago
March 19, 2021
2 replies
16 views

I have been told that it is important that I note that my K-1 for 2020 is a FINAL K-1. This apparently will trigger certain entries that should lead to my being able to report investment losses (on Schedule D and Form 8949). I see nowhere in the process where I can specify that the K-1 is FINAL. Please advise. Thank you.

Mike9241

Level 15

Turbotax does a poor job for the description. you must check yes to the partnership ended in 2020. this checks the final K-1 box on the k-1 worksheet.

then you should be able to check complete disposition

be careful

you didn't say if this was owned through your brokerage a/c or outside of it like a privately held partnership. so what you need to enter and where can vary greatly.

i can assure you that if this is a publicly held partnership (part 1 box d) will be checked. the broker does not know your actual tax basis. That will come from a supplemental schedule that the partnership provides with the k-1. you use this to calculate your correct tax basis which goes on the 1099-B worksheet. the only info that gets reported on the k-1 partnership sales worksheet is any ordinary income from disposition, if it exists it will be a separate column on the sales schedule,

for a privately held partnership there too, you have to determine your tax basis. if applicable, the partnership should provide you with the amount of any ordinary income that needs to be reported under section 751

Mike9241

MaxTax00

Level 5

@Mike9241

I got a K-1 for a Publicly Traded Partnership (ETF in this case) and I have a cumulative adjustment to basis of -3500 on the sales schedule. I realize I must make this adjustment to the related trades by lowering my cost basis so that I don't claim a 3500 dollar loss that does not exist. My question is, what is the most common way people go about doing this? In my case, the -3500 adjustment is spread out over 5 trades in the same ETF. Should I simply lower my cost basis by going into each trade on FORM 8949 and lowering the cost basis for each of these transactions by the amounts outlined in the Sales Schedule.....or should I just add a line to my FORM 8949 that says "K-1 Cost Basis adjustment" and put a transaction with proceeds of $3500 and a cost of 0. The net result is the same either way, I was just curious what is viewed as the standard way of doing things. These trades were all purchased and sold within calendar year 2020 and no position was left at the end of the year.