the main issue among us is whether that $42K of other increase/decrease adds to your tax basis. different preparers do things differently, so we have no way of knowing if it does or doesn't. it could represent some item of income or other item adding to tax basis or merely a plug which wouldn't to zero out the ending capital account.
Because liabilities add to outside tax basis, losses (inluding those deductible and those that are not) can actually exceed your investment, thus schedule L which is supposed to be on the tax basis can have ending negative capital. liabilities are not included in schedule L. Outside tax basis at the beginning of the year was about $ 141K with liabilities allocated of about $170K which would seem to indicate that beginning capital in schedule L was a negative $29K. Losses (or at least some items in part III are a negative $13K giving you temporarily a negative capital account of about $42K. That$42K which increases your capital account may or may not add to tax basis.
according to the k-1 other increases/decreases requires an explanation which may be on line 20 or a supplement.
