from what i can tell by Turbotax warnings is that the Turbotax k-1's worksheets are not final
NOTE: If this is a full or partial disposition of a publicly traded partnership (PTP) or master limited partnership (MLP) that was reported to you on a Form 1099-B, enter a sales price of zero on line 5 and a basis of zero on line 7 below. Enter the 1099-B transaction on Schedule D, checking the appropriate "Reported on 1099-B"
if this is a final k-1 check final
also check partner sold or disposed of their entire interest. then zoom to the supplemental disposition worksheet
in the part II section is where the disposition info is supposed to be entered.
the Turbotax instructions are correct for this section if there is no 751 gain. it there is it would be reported in box 20 you should also have received a supplemental schedule from the partnership on reporting the disposition including any 751 recapture. this is ordinary income
if there is 751 gain this is reported as the sales price line 5
basis is 0
on line 9 report the 751 amount.
this will flow to form 4797 line 10
the instructions for the 1099-B are also incorrect. the brokerage has no way of knowing the items that affect your basis in the partnership. as a matter of fact, what they report as the tax basis is your purchase price.
for tax purposes that must be adjusted for partnership items that affect basis. these would be items of income and loss, distributions and any 751 gain.
the partnership supplies a worksheet that allows you to determine your correct basis for tax purposes on which gain or loss is determined
on the 1099-B the sale would/should be coded as other B or D - cost basis not reported to IRS
To me this is asking me to contradict and zero our the the Sale, Basis reajustment from the MLP K1, and capital gains and ordinary gains input into the TT software and replace it all with just the 1099 schedule B brokerage download. These details show historical basi per original purchase price.
If I am reading this correctly then Turbo Tax sofware is incorrect anad has been for many years.
yes. the instructions below line 4 in Part II are totally inaccurate except in the following situations which will likely never happen. The partnership has no items of income, loss, credits, or distributions. also where the income including 751 gain was equal to the distributions - no other items.
There is no support from TT on the downloaded sofware anymore, so it would be great if someone could help me with this.
