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April 3, 2022
Question

Reporting Final LLC Partnership Sale on Schedule D

  • April 3, 2022
  • 1 reply
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Every year I get lost in the woods when it comes to dealing with my K-1s.  This year I have a final K-1 from a real estate LLC (my activity all passive) that I know I need to enter a final disposition sale on Schedule D in addition to entering the K-1 information.  What I am unsure of is how to report the sale and from what basis.  I assume I would calculate the basis as usual.   But since this is a final K-1, I would not include the qualified nonrecouse and recourse financing since the liability is not present at the closure of the partnership.   The following is what I believe to be the correct calculation.

 

From my Final K-1 IRS Form 1065

 

Beginning Capital        225859

Line 1                                 -8136            Ordinary Business Income

Line 2                              -20728             Net Rental Real Estate Income

Line 9c                             36955             Unrecaptured Section 1250 Gain

Line 10                          105221             Net Section 1231 Gain

=========================================================

Final Basis                    339171

 

Line 19A                      317706            Distribution

 

There are no other deductions or gains listed.

 

So the final sale for Schedule D would be reported as 339171 (basis) – 317706 (final distribution = 21465 (loss).

Is this the correct way to report the sale?

    1 reply

    PatriciaV
    Employee
    April 5, 2022

    Yes, you would report this as a the sale of your partnership interest, using the basis you have calculated.

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