Mike 9241:
Wow! Thanks for you very helpful reply to my questions. I appreciate the time you took to help me.
I have rewritten my reply to your message to me yesterday. Hope this is more readable!
Let me give you a little more background. I am 82 years old and am a retired engineering manager, (BSEE and MEA). I have had lots of experience over the years with Limited Partnership, Small Business, and Trust Returns all using Turbo Tax Business over the past 40 plus years. Turbotax is much easier to use today than it was in the 1980s. I'm using Turbotax Premier now as it handles my investment income very nicely. I'm finding it more difficult to understand some complex things at my age.
I purchased eight limited partnership interests from the same New York stock broker company in 2011 and 2012. Seven of them have gone out of business leaving me no or very little return. I have K-1s for each of them from the time I bought them until they were written off.
The partnership included in my 2023 tax return filed a final K-1 and I'm closing it out with this 2023 tax return. (I filed an extension in April). I have K-1s for each year since I purchased it. There has been no business activity in each of these years. The final K-1 shows in section L of the K-1 Beginning capital of 75,000, Current year net income (loss) of -70,755 and Other decrease of -4,245 with Ending capital account of 0.00. The notes on the K-1 list the -70,755 as a long-term capital loss and the -4,245 as "capital account adjustment for syndication costs" (I assume this is the sales costs when I purchased it in 2011). There is no further help given, other than "Please consult your tax advisor".
The information I've seen online indicates that syndication costs can be written off as part of the loss when a limited partnership is closed.
I would like to enter the -4,245 as a loss and to take a total loss of -75,000 for 2023 . I've spent time with the Partner's Instructions for Schedule K-1 (Form 1065) and don't see how to take this additional loss. Can you suggest how to account for syndication costs in Turbotax Premier? The instructions for the "Worksheet for Adjusting the Basis of a Partner's Interest in the Partnership" are not very helpful. I don't see any of the entries in the worksheet to decrease a partner's interest that are applicable. I can made an entry to increase a partners' basis by making it negative and it creates a loss, but not sure that is the right way to do this. I made "Other increases to basis" negative and added an explanation that it was "syndication costs"and that created a reduction in basis. But, I'm not sure that is right. Do you have a suggestion as to how to account for the loss from syndication costs?
Thanks again for your help with this. I see that several others have had similar questions about closing out limited partnerships with syndication costs. I'm sure other are appreciating your help with this! I just rewrote and shortened this entry. Hope it is easier to read now.
veehbj
