@mlpinvestor My condolences on your father's passing. With regards to his K-1, I haven't worked through the mechanics or tax implications of K-1s at death, so don't want to mislead. My intuition is to contact the MLP / K-1 preparer, and request two K-1s: One for the period 1/1/21 until his death, which is when the partnership needs to be officially re-titled into his trust. Then a 2nd one, for the period from then until the sale. That 2nd one will have the correct basis, ord gain, and any other items of income or loss that need to be reported.
Note that its probably worth posting a separate question specifically on how the step-up should work, since I'd assume (but don't know) that the suspended losses are wiped out.
On the MLP that converted to a C-Corp, TT doesn't do anything with the line 19 entries, so entering it isn't a problem. But you still have to report the conversion. You do this by essentially thinking about the transaction in 2 parts:
- You sold the MLP for cash (reporting a complete disposition in TT)
- You immediately used that cash to buy stock in the new C-Corp (nothing to report, but setting your basis in the new stock)
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**Note also, I'm not a Tax Preparer/CPA. Just a volunteer, seasoned, TurboTax user.
Use any advice accordingly!
