Transferred LLC Interests and Received 2 K1s

[MDR11]

I think I posted this in the wrong forum so posting here.

HI.  I transferred a few LLC interests to a revocable trust mid-year and I received 2 K-1s for the same investment, one in my individual name and the other in the name of the trust.  I presume income and losses were apportioned between the 2 based upon length of ownership.  I think I should add up the numbers in each line item and input them that way into TT.  Is that correct?  If I input the second K1 as a new one I think all my loss carryovers will get screwed up and it will be nightmare once the assets are sold.

If so, will it get flagged by the IRS? I'm concerned the IRS will be notified that I received 2 K-1s from the issuer but only 1 is reported on TT.

Any thoughts or suggestion are appreciated.

[jtax]

I don't know if the IRS will be looking for two k1s or just look at the totals. I bet the totals (assuming the same SSN/tax id).

If the revocable living trust is just yours (you or the settlor/grantor and you have the right to revoke the trust), it will be a disregarded entity as far as the IRS is concerned and you use your SSN for the trusts tax-id. If so, then I would do as you suggest and only enter a single K-1 in TT. You are correct that will keep your passive activity/basis info all in one place and make everything simpler going forward.

See e.g.

https://atlantislaw.com/7-irs-rules-that-may-make-your-trust-a-disregarded-entity/

The IRS treats all revocable living trusts as disregarded entities.[i] This means that even though a trust legally owns the taxable property or taxable income, it does not need to file a separate tax return. This is because the IRS disregards the trust entity. Instead, the IRS treats the grantor of the trust as the real owner of the taxable property or income.