forex gains and losses for partnership account

Forum|Forum|6 years ago
February 1, 2020
6 replies
59 views

Hi.

I have a question regards to forex gains on partnership account. Since forex gains and losses are ordinary income by default, how do I report on partnership(1065, k-1) ?

thank you

TurboTax Business Windows

Best answer by Anonymous_

You will have to enter the transactions (or a summary) in Forms Mode.

For trades that default to Section 988, enter on page 4 of Form 1065 under Line 11 (at the bottom under "Type" enter "A" for the code, a description, and an amount.

For 1256 contracts, click the Open Form icon, open and complete Form 6781.

Anonymous_Answer

Level 15

You will have to enter the transactions (or a summary) in Forms Mode.

For trades that default to Section 988, enter on page 4 of Form 1065 under Line 11 (at the bottom under "Type" enter "A" for the code, a description, and an amount.

For 1256 contracts, click the Open Form icon, open and complete Form 6781.

HyoAuthor

Level 2

Thank you for the response,

Considering I dont have any other business income(only 988 forex income)

Q1. Would income section of page 1 be blank?

Q2. Where do I input trading expenses for monthly subscription fee? Or monthly software subscription fee? (section 179 for computers, monitors, etc, what about softwares?)

Q3. page 4 line 11, what does “A” mean?

Do I put “A forex” for type? And $xx.xx for an amount?

Thank you

Anonymous_

Level 15

Please forgive this question, but do you actually have a partnership or multi-member LLC? I presume that you do but just want to make sure you are not a single-member LLC.

Also presuming that this enterprise is not your trade or business such that income would be subject to self-employment tax when passed through to the partners (members), then you would not have ordinary business income.

Your Section 179 expense would have to be entered in Forms Mode (Schedule K) since your scenario is a nonstandard scenario for the 1065 module of TurboTax Business.

The "A" is just a code that flows through to your K-1s (it is in the dropdown list under "Type"). It merely triggers the proper treatment when the partners (members) input the information from their K-1s on the personal income tax returns. If you still cannot locate that, post and let me know and I will try to include a screenshot.