Does the Schedule K1 TT interview also adjust the 1099 stock trades with no cost basis? I sold Energy Transfer in 2021 - less than 30 days RT - no dividends received

[CG1]

Also are the applicable states - my state return - filled in with the necessary K1 info as well?

[nexchap · Accepted solution]

TT doesn't do anything to adjust your 1099-B, or calculate the correct cost basis.  You have to change the basis yourself.  In the 1099-B interview, there will be an option to check a box for "My cost basis is incorrect" and you'll be able to enter the correct information.

When you start your state return, you'll see a K-1 worksheet already there that comes from your Fed return.

[CG1]

Thanks!

So what is best way to determine share cost basis?

Use the adjusted or average cost basis from K1 and divide by total shares.

This number is lower than original ET purchase price.

[nexchap]

@CG1 The formula is:

[your original purchase price] +

[the adjustments shown on the K-1 sales schedule*] +

[any Ordinary Gain shown on the sales schedule**]

*the adjustments are usually negative, lowering your cost basis.  That's because PTPs tend to generate losses, which are reported on Sched E

**the Ordinary Gain gets reported in the K-1 interview, so needs to be added here to avoid double-taxing it.