Schedule K-1 Line 17 Box K reports dispositions of property with Section 179 deductions. If your K-1 has nothing for that code, you can leave these boxes blank.
Since the S-Corp was sold to a third party, you should report this as a "complete disposition" and that you sold your interest in the company.
You can review how the Section 1231 loss offset your Capital Gains/Losses on Schedule D Part II and Form 4797 Part I. Note that capital losses are limited to $3,000. Unused capital losses are included with your tax return until the loss is used up, either by reducing your taxable income or netted against capital gains.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
