Level 12

Business & farm

Below are my comments based on your facts:

  1. You don't indicate how long you had your interest in the partnership, but you should have been maintaining a tax basis schedule of your interest in this partnership.
  2. You don't mention how section L was presented on your K-1; what box was marked on your 2018 K-1?
  3. Since the sale was on the installment method, you should have completed a form 6252 in 2018.
  4. The information on form 6252 would then be used in 2020 to complete the gain recognized and to be reported on Schedule D.  The form 6252 would have been included in your 2019 return, but there would have been no impact since no distributions were received.
  5. Doesn't appear that you need to amend 2019 since you did not receive any distributions.  Your section L is not really the full story.  The key in all of this is understanding your tax basis, which may or may not be presented on that basis in section L.
  6. If you received a distribution in 2020, you most likely have capital gain.  However, based on the limited facts and not knowing your tax basis it is hard to provide much more guidance than what is provided above.
*A reminder that posts in a forum such as this do not constitute tax advice.*