How to adjust cost basis on 1099-B worksheet

[Kell7]

I sold all units of a partnership in Blackstone and received the final K-1 from them with the sales schedule. This indicates a capital account and partner share of liabilities; which when I add those together understand that is my basis in the investment (lower than the purchase price initially). (-I do not know if return of capital is reflected here in the capital account value.-) So I know that the difference from this number and my original basis is a GAIN upon selling this. I also have the 1099-B which I imported directly, showing this sale, placing this sale in box E for form 8949 and schedule D. It shows a cost basis, (which is not correct in the present time but was when the shares where bought). So I need to adjust this. However when I go to the 1099-B worksheet and EDIT, it lists 12 sale items for the shares sold, since they were all bought essentially at 12 different times over the years each with different basis. I can edit individual items but cannot just edit/adjust the cost basis overall. So do I just choose the first purchased ones and adjust those, hoping to see the adjusted amount push to schedule D part II line 9(g)? When following instructions re K-1 part II "Disposition of Partnership Interest" it says to put zero for 5, 7 but if I put in a gain, it makes it a negative number on schedule D. Lastly even if the entire cost basis is put as zero, it does not change my tax due, but I am concerned about mismatch in records going to IRS.

[Anonymous]

there are many Blackstone partnerships does your k-1 have the partnerships tax ID number as 20-8875684

then that partnership converted to a C-Corp on 7/1/2019

so then it depends on whether you sold the units before or after the conversion

before the conversion 

liabilities should be 0 for end of the year.  your tax basis is starts with scheduke L  - beginning capital  + current year net income - less distributions (box 19a) + ordinary income recapture column 7 of sales scedule.

substitute this for what the 1099-B is using as cost basis line 7a. ( Since this cost basis is not reported to IRS you dont have to mess around  with the 7b column

the ordinary income needs to be reported thru the disposition link sales price 9 (line 5)  = same as column 7 of sales schedule  basis (line 7) = 0 ordinary income (line 9) same as line 5.  this will flow to form 4797 page 1 line 10   

after conversion  theres a worksheet with

lines A  original cost from your records

line B prefilled

line C combine linnes A nd B

line D  if negatibe you have a capital gain to report and line e becomes 0

Line E Stock basis this is what's used for the 1099-B

[Kell7]

yes that is the same TIN. I sold all prior to conversion. OK that all makes sense to arrive at adj. cost basis. Form 4797 is correct. In adjusting cost basis on the 1099-B, it is imported, and thus lists 12 transactions since original share purchases occurred on several dates then reinvestment bought additional shares on other dates. Which one of these 12 entries should I adjust cost basis on? FIFO -- or the first purchased ones? Or does it need to be divided over all 12 entries?

[Kell7]

Also, on the 2019 Sales Schedule column (5) "Cumulative Adjustment to Basis" it lists ($57) which I assume I also subtract from my basis.

[cnoonan321]

Good afternoon Kell7! @Kell7 

I've recently been trying to figure out the adjusted cost basis based on the K-1 report for Blackstone. The problem is my client passed away in March, and the K-1 is for January-July, so he does not have an ending capital account, so I have added his beginning capital account to the beginning partner's share of liabilities. My question is for partner's share of liabilities, do I add nonrecourse to the beginning capital account by itself, or do I also add the qualified nonrecourse financing. I appreciate any help you can give!

[cnoonan321]

@Kell7 @Anonymous additionally, most of the shares were sold before 7/1/19, and some were sold after, and I am unsure about how to go about the differences between the two