I've already filed 2022 1040 forms and need to amend based on late arriving K-1 for an LLC that bought/sold land after making improvements. I was a passive investor.
You have not filed a '22 return the current tax year is 2021 and that's the last year you could file for until 2023 when you'll be able to file your 2022 return
3 Questions:
1. Original investment was in 2004 for $25K. In the final K-1 there is a distribution of $4K. Is there a place for me to claim a $21K capital loss? you probably do not have a $21K capital loss see below.
2. The $4K distribution is a check that I'm not going to receive until next week, in 2022. I'm assuming that since it's called out on the 2021 K-1 it belongs in my 2021 taxes... but LMK if I need to hold onto that until 2022 filing.
3. Over the years I've received an annual K-1 describing that year's (passive) business loss which has carried forward. The sum of these passive business losses is around $11K. Can I also take that? Or is that somehow already part of the $21K I calculated in question #1?
Note there was a (large) distribution in 2007 and at that time I paid taxes on that as ordinary income and got relief for the (up to that time) accumulated passive losses.
you need to determine your tax basis in the partnership to determine whether you have a capital loss or not. your tax basis starts out with the $25K you invested in 2004 it is increased by all items of income reported on your k-1s from 2004 to the year of your final k-1. it goes down by all losses and distributions during the same period reported on the k-1. this is your tax basis which is different from suspended losses.
since the partnership terminated in 2021 (final k-1) the suspended passive losses will be released. in effect they become nonpassive.
