Hi,
I am working on 2022 tax return and need some help on K-1.
Part 1: Background info:
On 2020, We purchased some shares of USO.
For 2021 tax year, we received K-1 for USO and it reported we had gain $NNN although we never sold any shares of USO in 2021. We included $NNN in 2021 tax return.
For 2022 tax year, we received K-1 for USO and it reported we had gain $MMM.
We sold USO in 2022. That is why we also received 1099-B for USO sale.
Part 2: Issue I run into
For my 2022 tax return, I will include $MMM from K-1.
But here is the issue. The cost base in 1099-B USO sale is original one. The capital gain reported on 1099-B doesn’t count $NNN from 2021 K-1 and $MMM from 2022 K-1. Correct capital gain should be the amount from 1099-B - $NNN - $MMM.
Part 3: Questions
How to report correct gain for USO on Turbo Tax? I was told to add $NNN and $MMM to the cost basis of USO. If we do that, that will make cost basis of USO is not same as reported on 1099-B.
Or there are any ways to adjust cost basis of USO without modifying cost base from 1099-B (for example enter $NNN and $MMM on a form 1234, etc.)?
If we have to modify cost basis on 1099-B, should I write a note to IRS to explain cost basis discrepancy? If explanation is needed, that mean I have to file by paper to include USO cost explanation since I don’t think we can send note to IRS via e-file.
Thanks!
BL
