You need to understand how partnership K-1's work:
- The partnership entity is not subject to tax
- All income, loss, gains, etc. pass through to the partners
- You, the partner, input all the information from the K-1 into TT and TT will handle the rest
- The amount on line 11c of your K-1 is a gain from the entity level. You will pick this up and report it and "yes" your tax will increase as a result. This is not an unrealized gain. This is a realized gain at the partnership level.
- Most partnerships also pass out some distributions to help partners cover the tax. This may or may not have been done with your partnership. Regardless, you as a partner will pay the tax.
- As a partner in a partnership, you should be maintaining a basis schedule (tax basis). This gain that you are reporting will increase your basis.
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
