Question

Loss on Private Investment

Forum|Forum|4 years ago
September 2, 2021
2 replies
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I am invested in a real estate deal, a shopping center. Every year, I have received a K-1. The investment is, unfortunately, a total loss. I file the K-1s every year and got one this year that does not reflect a total loss. It is indeed a loss. Idon't know how to use Turbo Tax to document the loss of my initial investment. Could someone show my how to document the loss?

TurboTax Home & Biz Windows

A

Anonymous_

Employee

There is a worksheet for adjusting (calculating) your basis in the partnership.

See https://www.irs.gov/instructions/i1065sk1#idm140228279135040

Note that, generally, once the losses exceed the amount of your initial investment (or adjusted basis) you are no longer at risk and, therefore, cannot recognize any further losses.

M

Mike9241

you put in a total of X. the k-1's reported losses and deductions of less any items of income of Y over the years. you may have received distributions reported on the k-1's of Z over the years.

your adjusted basis before losses would be X less Z. if Y is less than your adjusted basis the balance is reported as a long-term capital loss. if it's more than the excess is not deductible.

https://tax.thomsonreuters.com/content/dam/ewp-m/documents/tax/en/pdf/other/quickfinder-updates/qpep-march-updates_comb.pdf

while this is for one year all years can be combined. ignore lines 1, 6 and 7, and 16 through 21.

if line 15 is positive then this amount would be your capital loss. if it's negative that means losses exceed your basis. any losses reported on the current year k-1 would need to be reduced by this amount.