Section 988 Income from k-1

Forum|Forum|1 year ago
April 8, 2025
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I have Section 988 income reported to me on line 11A as Other Income on my a k-1. Does this amount end up on Schedule E , Part II or should it go to Schedule 1, Part I, line 8z?

mglauner

Per Expert @PatriciaV:

"Activity reported on Schedule K-1 Box 11(i) is often entered on the partner's tax return in areas other than the K-1. In the case of Section 988 gain/loss, you would enter this as Other Reportable Income.

According to Section 988: "Except as otherwise provided in this section, any foreign currency gain or loss attributable to a section 988 transaction shall be computed separately and treated as ordinary income or loss (as the case may be)."

To find this area of TurboTax, go to Federal taxes >> Wages & income >> Less common income - Misc income 1099-A 1099-C >> Other reportable income."

@MAC18

MAC18Author

The Section 988 income was reported to me on box 11(a) of the k-1, not 11(i) as you indicated in your response. As such, I believe the appropriate place to put it on my return is on Schedule E, Part II, column K. I also found a footnote in the k-1 telling me to put this income on schedule E.

I have additional income reported to me on the same Box 11(a) with the only description being "Other Portfolio Income". Should this also go to schedule E or should I put this as Other Income on Schedule 1?

PatriciaV

Employee

Regardless of the code provided on Schedule K-1 Box 11, if the additional information indicates the amount relates to Section 988, the income or loss is reported as "other reportable income." The instructions previously posted are correct for reporting this activity.

According to Section 988: "Except as otherwise provided in this section, any foreign currency gain or loss attributable to a section 988 transaction shall be computed separately and treated as ordinary income or loss (as the case may be)."

The additional portfolio income reported for Box 11 would be entered the same way (other reportable income). The difference is how the amounts affect your return. Section 988 refers to foreign currency transactions, which may or may not need to be reported elsewhere on your return.

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