K-1 forms for Individual Stocks or ETFS?

[PJhiker]

So, I was not are I might get K-1 forms from individual stocks or ETFs I traded through Webull or Robinhood. Can someone please explain this to me? I essentially broke even in my trading for the year and as of now expect to pay very little in capital gains taxes as a result. However, this K-1 form thing through brokerage trades has me concerned. I traded different securities fairly often in a scalp trading strategy. My question is how would I receive these K-1 forms? Do I get them through the brokerage? I have heard the deadline to receive these is by March 15th,. Is that accurate? And, how might this negatively impact my capital gains or taxes I might owe? For example if I gained on some securities I purchased and lost on others who distribute a K-1 how does that calculate? And, how do I determine securities that do this in the future?

[MonikaK1]

If you invested through a brokerage, contact them for more information as to how and when your Schedule K-1 may become available. Yes, the regular due date for issuance is March 15th. In order to file an accurate return, wait until you have the K-1 before finishing and filing your return.

See this article from Yahoo! finance regarding ETFs and Schedule K-1, including a list of those who issue Schedule K-1s because they are structured as partnerships. 

Securities that issue a K-1 may require investors to report and pay taxes on gains annually, even if the security has not been sold. 

See also this TurboTax tips article for more information on Schedule K-1, and this one for help with entering the K-1 in TurboTax. 

[PJhiker]

Crap, so if I I made gains on ETFs or other securities through a brokerage that are partnerships and issue K-1s and lost on others that don't those gains will not be offset? So even though I broke even essentially for the year for my brokerage gains/losses I still might have to pay capital gains on the K-1 securities if I gained on them?

[JamesG1]

Are you referring to publicly traded partnerships that report gain or loss on a partnership K-1?

Publicly traded partnership losses have minimal use for the unit holder.

• If a certain PTP has a loss, that loss can only offset earnings in the future from that same publicly traded partnership.
• This is unlike non-PTP passive actions, in which allocated losses can go toward offsetting earnings for other passive actions.

For instance, PTP A reports $5,000 loss and PTP B reports $5,000 gain.  You are not allowed to net the gain against the loss on the 2022 Federal 1040 tax return.

You report the gain and pay income tax on the reported gain.

You hold the loss in suspension until such time that you can offset that loss against a gain from that same publicly traded partnership.

The partnership K-1 (Form 1065) records the partnership as a publicly traded partnership in Part I box D.

@PJhiker