MLP Sales Help
Edit as I have researched and figured out some stuff.
I have owned MLP for years and researched how to deal with K-1s and still cannot figure it out. I think I really need to find a “TRUE” MLP expert, but I will come back to that in Q3.
Q1) Sold an MLP in 2019 that I bought in 2018.
The MLP distributions are tax free therefore upon sale I have to recapture and pay ordinary income tax on that amount. So the distribution would decrease my basis. But also that Suspended loss would carryovers upon the sale of the MLP.
TT only seems to suspend negative values in Box 1 - 10. For most the other boxes I get an * saying Not provide by program.
I am going to show the MLP numbers for Box 1-10 for 2018 and 2019 with negative numbers that had to be deferred until the sale of the MLP and show Box 19 Distributions.
First Starting Basis when purchased = $6,703 and proceeds upon sale was $6,225
Year Box 1 Box 10 Box 19
2018 -434 -1 491
2019 -202 -405 338
Total $-636 $-406 $829
Using the MLP Sales Schedule
It states in Box 5 my Cumulative Adjustments to Bases is $-1,891 for a Cost Basis of $4,812.
According to the MLP sales Schedule Box 7, my ordinary Gain is $1,656, which I believe in part to the depreciation recapture that must be paid as ordinary gains.
Using that information my Short and Long Term Capital Gain would be:
The Ord Gain = $1,656 - $636 Box (1 Suspended Losses) - $406 (Box 10 Suspended Losses) = $614. That assumes I can apply the suspend Box 10 losses here.
Long Term Capital Gain = -$243
So both my long and short term gain total would be $614 - $243 = $371
Assuming that is correct, why does it differ from my actual gain.
I had an actual loss of $6,225 - $6,703 = -$478 and I receive $829 in Distributions, so I made $351 (total both long and short term gain).
Why is there a $20 difference?? It seems like I should have $20 in suspended losses. I cannot figure out how to account for that difference.
Q2) I would like to understand exactly what is used to increase ones basis and what is used to decrease ones basis. I finally after playing around for hours was able to find numbers to add togeterh to make it match to Part II L. Is there any document anywhere that shows detailed information of which boxes and codes are added to the basis and which ones are reductions to the basis.
Capital Contributed during the year $6,703
Current year increase (decrease) -408
Withdrawal a& Distributions $491
In order to get that -$408 decrease to the basis I had to add Box 1-11 and from that deduct Box 13, Box 16 P (only) and Box 18C.
Q3) I would like to find a “TRUE” MLP K-1 Expert. I can do the easy boxes, but TT does not handle the hard boxes. I want to find someone that understand all the boxes including Box 11I and Box 20 and exactly where everything goes and what is deferred and how to accurately calculate the basis, capital and ordinary gains on a sale.
