i found more info which I'll link to. The deemed sale of MIC Hawaii and the dividend were treated as a partnership distribution in 2021 of $37.3868/share so your k-1 should reflect on line 19 $3738.68 or $3739 (this reduces your tax basis in the MLP) of this $179 was taxed as a dividend as you are aware. Not sure if this was on k-1 or broker 1099-DIV. The other $3560 was either a short or long-term capital gain depending on your holding period of MIC. Again, I'm not sure if this was reflected on the K-1 or your 1099-B for 2021. depending on the acquisition date for MIC. things can get even more complicate because MIC paid return of capital dividends in early 2021. ROC dividends reduce the tax basis of the MIC stock you bought. so the question becomes was the proper tax basis reported to MIC when it became an MLP. that's your starting tax basis in the MLP. I can't see your K-1 so what was reported on the other lines is important to know if the $700+ increase in tax basis as reported on the sales schedule is correct (or how it was computed). Corporations subject to US tax laws must report reorganizations to the IRS on form 8937. Also, the corporation would have sent you documentation regarding the reorg and the tax consequences thereof. so you should have gotten it even if the shares were held in the brokerage.
https://www.micinc.com/investor-center.html
https://www.micinc.com/investor-center/tax-information.html look under Atlantic Aviation Transaction distribution.
MORE INFORMATION
when you sold in 2022 the 1099-B should have reflected as cost your basis in the MIC LLP (not adjusted for MLP activity) reduce by any ROC dividends when it was a corporation during the period you held it. ROC dividends (nondividend distributions) would have been reported on the 1099-Div issued by your broker on line 3. this should have been what the-1 showed as contributed capital because all ROC dividends occurred before conversion. then your tax basis in the MLP would have gone up by 2021 income and reduce by all losses, deductions and distributions for 2021 which I gather was the first and final year of the MLP. the final K-1 in 2021 probably plugged withdrawals and distrubutions so zero ending capital was shown.
