Hello, my husband bought and sold UNO in 2023, and he received 1099b and schedule K-1. I have problems in filing the tax for it. There are two 1099b, one is non-covered securities, with cost basis reported in form 8949. The sales price is 43,849, and cost basis is 43915. With some wash sales, the gain is $1,808. The other 1099b is aggregated loss on contract for 1256 contracts, and the total P/L is -429. The K-1 shows -2,372 in 11c. In the sales schedule, the initial basis is 43,283, the cumulative adjustment to basis is -2,423, and the cost basis is 40,860.
I think I should report both K-1, 1099b and 1256. In form 6781 line 1 I reported -2,372 from K-1 and -429 from 1099b. Is this correct?
I am not sure how to adjust the cost basis for 1099b. Shall I use 43,915 minus 2,423? Or shall I use 40,860? The cost basis in 1099b is different from the initial cost shown on K-1.
Any advice is welcome. Thank you!
You need to treat these as entirely separate transactions. The amounts being reported to you on the 1099-B are not the same amounts reported on the K-1. At least they shouldn't be. You should be reporting the 1099-Bs each exactly as they are on the forms in the section for 1099-B and the K-1 in the section for K-1s exactly as that is printed.
I reported K-1 exactly following the K-1 form. My question is about the 1099b cost basis. Do I need to adjust the cost basis in 1099b according to the information on K-1?
Yes, you need to adjust the cost basis reported on Form 1099-B. If the information from the K-1 package was entered/reported correctly, the program should have already entered whatever capital gain/loss you had on Form 8949 and any ordinary income on Schedule E. However, the IRS is expecting a 1099-B transaction to be included on your tax return. So you have to report the 1099-B. In order to prevent your gain from being reported twice, you have to adjust the cost basis so that it is the same as the proceeds amount, resulting in no gain or loss from the 1099-B entry.