sorry I missed those instructions. however, those they seem more for those that do their return manually.
PART II – WHAT TO INCLUDE ON YOUR FEDERAL INDIVIDUAL INCOME TAX
RETURN
Combine any current year income, gains and losses, and any prior year unallowed losses to see if you have an overall gain or loss from the Partnership. If the sum of the amounts on Lines 1 and 10 of your Federal Schedule K-1 combine to result in a loss, do not include the amounts reported on Lines 1, 9c, 10, or 17 codes A and B of your Schedule K-1. What wasn't stated and is important is that any prior year suspended losses need to be included in the calculation. Not just any current year net income/loss. for example, if lines 1 and 10 net to income of say $3000 but you have prior year suspended losses on $8000 you have an overall net loss of $5000 which would be suspended unless you sold CF before 7/1/2024. Complete disposition before that date releases any suspended losses
as long as box D is check on the Turbotax K-1. It will properly suspend any net losses. unless you disposed of your entire interest in the Partnership before 7/1/2024. Publicly traded partnerships do not report passive income/losses on form 8582
However, report the amount on Line 5 of your Schedule K-1
.
A loss resulting from the sum of the amounts on Lines 1 and 10 of your Schedule K-1 is considered passive and is only deductible in the current year to the extent that you have income from the same Partnership. As stated above this is what Turbotax will do - not allow the deduction of net passive losses. Unallowed losses cannot be carried back. If you held units at the date of the merger, any remaining suspended losses would adjust your tax basis in the stock received. If you did not own any units at July 1st, 2024, and you sold all of your units during the year, see the units sold section. If you disposed on all your stock on or before 7/1/2024, the rules for PTPs allow the deduction of those losses. Retain your Schedule K-1 and maintain a record of all unallowed losses from this Partnership to support your tax reporting in future years.
if you received stock then any suspended passive losses would add to their tax basis. The broker will not know what this number is. Upon their eventual sale, the gain/loss reported on the 1099-B would not be correct. an adjustment would need to be included on the 1099-B entry
if you did not dispose of CF in 2024 or sell the new stock in 2024, the k-1 will popup when you do 2025.
you will need to delete it. if you did not sell the new stock in 2024, you will need to make note of the suspended losses, so you know the number to use as an adjustment when you do sell. It's important to do that now, because after 3 years Turbotax no longer supports the 2024 app and you will not be able to open the xxx.tax2024 file. I strongly recommend you save the return - all forms and calculations worksheet as a pdf. A second copy should be kept offline. You'd be surprised by the number of incidents reported in the forum where the OPs hard drive has gone bad making recovery impossible
