Thanks for your help - I really appreciate it. It is amazing that with all these threads on this subject, TT hasn't decided to provide a solution. I'll go ahead and add the $820 to the 1099-B cost basis which for that transaction gives a loss of $120. That is $2,400 + $820=3,220. Sale price on 1099-B was $3,100 less New Cost Basis of $3,220 = -$120.
This actually brings the Total Return below the original basis with only the 1099-B. New Total Tax, due to long and short term profits from K-1 is now $1,890.
NOTE: I had followed your previous tread that I found in June 7, 2019 which I assume still applies. I followed your example, then added the $820 to my cost basis from the 1099-B. This was your previous example back in 2019:
3) Complete dispositions, all in one holding period: This is the only case where the K-1 interview works, but you still have to deal with the 1099-B that came in from the broker.
Because of all this, I handle all scenarios the same way:
- Use the K-1 interview for the 'ordinary gain' portion of the MLP sale, but not the capital gain/loss. Do this by: 1) enter 0 for sales proceeds, 2) enter the ordinary gain numbers provided on the K-1. Note that there will be two ordinary gain numbers, one for Regular and one for AMT, and 3) set your basis as the inverse of the ordinary gain (for example, if ordinary gain was 100 (regular) and 90 (AMT), set basis as -100 (regular) and -90 (AMT). Doing this puts the ordinary gain into all the right spots on your tax return, but sets the capital gain/loss as $0 for both Regular and AMT.
- Go the the 1099-B provided by your broker. There will be a cost they provide, which isn't reported to the IRS. This can be changed, so change it to whatever provides the correct cap gain/loss (you work out the cap gain/loss by using the K-1 worksheet).
