TT is including the Net LT Capital Gain in Box 9a on K-1 in the Net Investment Tax determination. I actively participate in this partnership (and indicated as such in the TT software), so this gain should not be included in that calculation. How do I get the software to exclude this amount from my 8960 determination?
it may not be excludable though you actively participate. NIIT applies to
§ 1.1411-5 Trades or businesses to which tax applies.
(a) In general. A trade or business is described in this section if such trade or business involves the conduct of a trade or business, and such trade or business is either—
(1) A passive activity (within the meaning of paragraph (b) of this section) with respect to the taxpayer; or
(2) The trade or business of a trader trading in financial instruments (as defined in paragraph (c)(1) of this section) or commodities (as defined in paragraph (c)(2) of this section).
(c) Trading in financial instruments or commodities—
(1) Definition of financial instruments. For purposes of section 1411 and the regulations thereunder, the term financial instruments includes stocks and other equity interests, evidences of indebtedness, options, forward or futures contracts, notional principal contracts, any other derivatives, or any evidence of an interest in any of the items described in this paragraph (c)(1). An evidence of an interest in any of the items described in this paragraph (c)(1) includes, but is not limited to, short positions or partial units in any of the items described in this paragraph (c)(1).
(2) Definition of commodities. For purposes of section 1411 and the regulations thereunder, the term commodities refers to items described in section 475(e)(2).
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