Hello,
I participated in a real estate partnership and the interest was purchased in 2023 fully sold in 2024. I want to confirm my understanding of how this needs to be reported. I am using Turbo Tax Premier to file.
2023:
- Initial capital contribution cash: 25,000
- Increase in partner's share of liabilities: 45,652
- Rental real estate loss: (9,047)
- Partner basis at end of year: 61,605
2024:
- Additional capital contribution cash: 6,146
- Decrease in partner's share of liabilities: (45,652)
- Rental real estate loss: (9,183)
- Section 1231 loss: (11,747)
- Partner basis at end of year: 1,170
After the partnership interest was sold, there were no distributions --> Sale price: 0
I did not materially participate in this partnership, and therefore, I had passive losses in 2023 (rental real estate loss of 9,047) that were carried forward to 2024.
However, as the partnership was fully disposed in 2024, I can deduct my losses.
- Long term capital loss of (1,170) is recorded on Schedule D with Form 8949
- Section 1231 loss of (11,747) is recorded as Other loss on Schedule 1 (line 4) with Form 4797
- Rental real estate loss of (18,230 including the PY carryover) is recorded as Rental real estate on Schedule 1 (line 5) with Schedule E
Is this understanding correct or there are any other considerations? Thanks!
