Where in the step by step interview process do I make adjustments for the difference between the brokerage basis for the PTP units and the basis reported on the K-1 sales schedule? Simply entering the sale information and the partnership basis in the PTP in the interview process results in a double taxation. Do I delete the brokerage transactions for the PTP or do I make adjustments for the amounts reported in the PTP interview process for entering sales info. Do I adjust the sale price to be equal to the basis reported by the brokerage and then increase or decrease the Partnership basis to reflect the actual basis?
@userOne To keep the K-1 interview from messing up your return, on the Sales screen enter the Ordinary Gain on the appropriate line (you may have different numbers for Regular vs AMT), enter its inverse on the cost basis line (e.g., if Ord Gain is $100, cost basis is -100), and put 0 for Sales Price. Now the K-1 won't create any new 1099-B entries.
For your cost basis, you'll adjust the value your broker provided on the 1099-B. You'll be given the opportunity to make those changes in the interview, or you can just do it directly in 'forms' mode.
i do it a little differently but same result. i enter the ordinary income as the sales price and then the same amount for the ordinary income.
I only need to report the short term (all units held less than one year) investment gain created by the cumulative adjustments to basis (reduced basis) reported on the sales schedule. The short-term investment gain reported from the sale of the PTP on the 1099B is correct except for this cumulative adjustment to basis.
After you enter your 1099-B you will be asked if you need to adjust the basis on any of the transactions. Just say yes and then adjust it so that it is correct. Since you're adjusting it so that you can pay more in taxes you won't really need to worry about it after that.