I have a somewhat unusual problem, for which I am hoping someone has some general guidance.
I own units (shares) of a Publicly Traded Partnership which issues a K-1. The units are actually in two separate brokerage accounts. One account is a personal account (my own), and the other is a joint account. Both accounts use the same social security number for tax reporting purposes, since I file a joint return.
Unfortunately, years ago, TaxPackageSupport, which does the back office work to issue the K-1, said the two accounts have to be combined on a single K-1 because both have the same Social Security #. I have found since with other PTP’s also handled by TaxPackageSupport allow separate K-1s in this situation; i.e. where the title /ownership is different separate K-1s are issued even though the SS# is the same.
So I would like to get the two accounts separated into two separate K-1s to reflect the separate ownership/title. I have reviewed the TaxPackageSupport activity files, and can help them separate the historical units and costs into two separate K-1 accounts. I assume they will do this and start to issue separate K-1s in the future (next tax reporting year).
Assuming that TaxPackageSupport will separate the accounts, my question is generally how to proceed in TurboTax. I think I would do the following:
- Calculate on a fair share basis the carry over loss, limitations etc. that apply to each of the two accounts. The loss carry forwards, etc. would be based on the ratio of current share values to the total of the two. The total of the two accounts would always equal the old total
- Create a new K-1 in TurboTax for the second account. Insert calculated prior year allowed losses, at risk limitations, etc. into the K-1 and attendant sub worksheets. Adjust the existing Losses, etc. down by the same amount on the existing K-1, so the total of the two is the same as it was prior to the change.
This results in two K-1 accounts with the loss history, allowed losses, etc. divided between the two of them with the total the same as it was. Assuming TaxPackageSupport then issues 2 separate K-1, it should fit in OK.
Having fully paid all taxes using the single K-1 representing the total, I would not refile or amend earlier year taxes…..just make the change on a going forward basis; i.e. next year’s tax return.
I am unfamiliar with how all the QuickZooms and sub worksheets that work with the TT K-1, so the general question is there any guidance on how best to accomplish splitting the two accounts?? Any and all help appreciated.
