Schedule 3k-1

[SandyOH]

Surprisingly, my former employer had an equity event in 2023. I had been granted shares as an employee and received a payout due to this event(I received proceeds minus the strike price).  I have finally received the K-1 and 3k-1. In the Reconciliation of Partner's Capital Account, line 26, "Massachusetts net income for the year," is less than line 27, "Entire net income for the year." I am not sure why or how to report this. Do I answer "yes" when asked if there is a difference and then enter the difference as a negative number since it is less? I am worried because when the question is presented in TurboTax asking if there is a difference, a message says, "This is uncommon."

Also, on the federal return, should I answer that I disposed of part of my interest in the partnership due to this equity event? Not all shares were involved in this event.

Thanks!

[tagteam]

I will page Champs @Rick19744 and @Mike9241 but I am not sure they are familiar with MA state.

[Rick19744 · Accepted solution]

I'm not exactly sure what question TT is asking or in what context:

• It is very possible that the two lines do not agree
• I would imagine that this happens in many cases, since line 26 is MA taxable only and line 27 would include all income both taxable and nontaxable income (if applicable), etc.
• If there is a difference, then I would respond accordingly.  Keep in mind that TT is prepared for the masses, but I certainly would not expect this to be "uncommon".
• There are not sufficient facts to address your second question.

[SandyOH]

Thank you! Very helpful. I did TurboTax Live Assist today and was able to work through it.