Schedule K-1
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BJ9
Level 1

Schedule K-1

I received a Final K-1. It is a passive partnership with investments in real-estate. Turbo tax asks how it was disposed. The partnership funds just finished with all real estate in the fund having been sold. The form does not specify the  type of disposition. what do I use? 

5 Replies
ToddL99
Employee Tax Expert

Schedule K-1

In this case,  the partnership ended, disposition was not via a sale, and the "sale date" (next screen) can be 12/31/2020 or the exact date the partnership terminated (if you know).

 

See the attached screenshots for how this looks in the K-1 interview.

 

BJ9
Level 1

Schedule K-1

Why wouldn't it be classified as a "Complete Disposition"? If this box is checked you get a far different deduction.

gloriah5200
Employee Tax Expert

Schedule K-1

Either way, you should be reporting the distribution(s) you received from the liquidation of your interest in the partnership.

 

A complete disposition would only be the sale of your interest whereas the liquidation of the partnership would be the disposition of all interests of the partnership.

BJ9
Level 1

Schedule K-1

So is it then classified as a "Disposition was not via a sale" in the TurboTax question screen?

AmyC
Employee Tax Expert

Schedule K-1

Yes. If you sold your share of the business to create your final k-1, then it was a sale. If the whole business was sold, then all got a k-1 from a sale. Otherwise,  business ended in a disposition.

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