Schedule K-1 Sales Schedule

Reporting the sale of a PTP is a combination of the typical 1099-B interview, and the K-1 interview.  If you did not have any Ordinary Income on the sale, then just enter 0 for everything on the K-1 and handle it through the 1099-B interview.  If you had Ordinary Income, this thread can guide you on how to enter it and not wind up with a double-reporting problem: https://ttlc.intuit.com/community/investments-and-rental-properties/discussion/how-i-report-the-sale-of-mlp-shares-in-turbo-tax-i-sold-all-shares/00/776624

the sale can get entered in two places.   on the k-1 to the extent of any ordinary income (section 751 income) reported on the sales schedule.  in the k-1 sales section, you would report the 751/ordinary income as the sales price, cost 0 ordinary income = sales price. this will flow to form 4797 line 10

your broker has reported the sale on form 1099-B with either code B or E - meaning it didn't report the cost/tax basis to the IRS. the form would show the cost as what you originally paid which is no longer the correct tax basis because none on the PTO's activity was taken into a/c - simply the broker does not know what it is 

so the correct tax basis for the 1099-b (not on the k-1 section because you will double up on reporting) is computed as follows

a) what you paid/purchase  price  - before any adjustments - should be on the sales schedule

b) less cumulative reductions to basis ( this is for the ptp activity including distributions)

sometimes the sales schedule will report cost basis which is them doing the math a) - b)

otherwise, you do the math say a) is 263 and b) is -230 = tentative cost basis  33

 c) to cost basis you add the 751/ordinary income

the result is the corrected cost/tax basis fr form 1099-B/8949/schedule D

Hi, @nexchap.  I’m attempting to follow your excellent instructions here, but I have hit a bit of a snag.  I’m filing a final return for a deceased taxpayer (my father) who owned an MLP that got bought out last year, just after his death.  There should be a step up in basis, since all assets reverted to his trust at death, but due to inopportune timing, the K-1 was issued in his name and SSN, and therefore does not reflect this.  There’s also no sales schedule provided that tells me what the adjusted basis should be, and he never kept track of it either.  So to avoid dealing with this, I’m hoping I can just use the market value on the date of death as my cost basis and go from there.  But this will create a discrepancy with what the K-1 says, since it lists an ordinary Section 751 gain that’s larger than what the entire gain would be under stepped-up basis rules.  Is this a problem I should be concerned with?

My thought was to just take the stepped-up basis and call the entire difference an ordinary gain, but I’ll defer to your recommendation.

Separately, I also have a final K-1 for some other shares in a different MLP that converted to a C-corp.  The newly-issued shares were a like-for-like exchange with the old ones, with the same cost basis.  However, my final K-1 also shows that same amount in Box 19C - other property.  Should I enter this box into Turbotax?  I don’t know what it will do with it.  Will it try to classify it as taxable income?  Obviously, it shouldn’t be.

Thanks a lot.

I am preparing a 1040 for my daughter and her husband and they have two K-1's for the sale of their business, a Sub - S   and have a capital gain of 873,032 and I want to file a Form 6252 to report the sale as an installment sale.  How do I do that on turbo tax?