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PTP: 1099B + K1?

Forum|Forum|5 years ago
April 7, 2021
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I bought and sold a PTP in 2020 thru a stock broker. I subsequently received a 1099-B from the broker reflecting a capital loss on the sale. Few weeks later, I received a separate K1 from the PTP showing (further) loss as Section 1256 and some other incomes. So, I want to make sure these losses are not related and they should be all reported separately in the TurboTax software. Right?

TurboTax Home & Biz Windows

Best answer by nexchap

You definitely want to report both the K-1 and the 1099-B. A partnership does not pay taxes at the partnership level. Instead, they pass all their taxable information down to the partners themselves (you) and you have to pay the taxes. So you do that by reporting everything in the K-1 section of the TT interview.

In addition, the partnership reporting will change your cost basis for the 1099-B. The info you got from the broker is likely incorrect (because they don't know what the partnership reported). You'll have to adjust the cost reported on the 1099-B.

Finally, be aware that you have to watch out for double-reporting the sale. This longer thread goes into more detail about some of the pitfalls, and how to make sure you only report the sales once: https://ttlc.intuit.com/community/investments-and-rental-properties/discussion/how-i-report-the-sale-of-mlp-shares-in-turbo-tax-i-sold-all-shares/00/776624

N

nexchapAnswer

You definitely want to report both the K-1 and the 1099-B. A partnership does not pay taxes at the partnership level. Instead, they pass all their taxable information down to the partners themselves (you) and you have to pay the taxes. So you do that by reporting everything in the K-1 section of the TT interview.

In addition, the partnership reporting will change your cost basis for the 1099-B. The info you got from the broker is likely incorrect (because they don't know what the partnership reported). You'll have to adjust the cost reported on the 1099-B.

Finally, be aware that you have to watch out for double-reporting the sale. This longer thread goes into more detail about some of the pitfalls, and how to make sure you only report the sales once: https://ttlc.intuit.com/community/investments-and-rental-properties/discussion/how-i-report-the-sale-of-mlp-shares-in-turbo-tax-i-sold-all-shares/00/776624

**Say "Thanks" by clicking the thumb icon in a post**Note also, I'm not a Tax Preparer/CPA. Just a volunteer, seasoned, TurboTax user. Use any advice accordingly!