Final K-1 Question

Forum|Forum|3 years ago
September 28, 2022
2 replies
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We received our Final K-1 for a limited partnership that we had invested money in. When entering the information into TurboTax, I selected "This partnership ended in 2021." The next page asks:

Choose how you disposed of this partnership/LLC.

Do I choose:

- Complete disposition

- Disposition was not via a sale

- Sold and am receiving payments

I am assuming I should choose "Complete disposition"? We already received our final payments for this partnership and will not receive any more.

HiCPA

Hi @mellynlee !

If you already received your final payments from the partnership and you have completely dissolved your share in the partnership through a sale, you can select the "complete disposition" option.

The TurboTax screens will then follow up to ask more questions about your sale, including entering in your sale date(s) and sale information.

Here is the IRS instructions for Schedule K-1 for a beneficiary filing form 1040 or 1040-SR for your reference. Link here

Enjoy the rest of your day!

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mellynleeAuthor

Thank you for your response.

I selected 'Complete Disposition', and TurboTax is requesting more information, as you mentioned.

For 'Purchase Date', what do I put?

- The date the check (of our investment) was received? (or the date the check is written?)

- The date of the letter that confirms receipt of above check?

For 'Sale Date', what do I put?

- The date of the final check that we received?

The following page requests information about Regular Gain/Loss and AMT Gain/Loss.

You provided a link to help with filling out this information. However, when I look at those instructions, they don't make any sense with my K-1. The link you provided is for Schedule K-1 (Form 1041). I have a Schedule K-1 (Form 1065).

Is there something that can help me fill out the information that TurboTax is asking for?

When it asks for 'Sale Price', do I just enter the amount of my final check?

I have no idea what the Selling Expense, Partnership Basis, Ordinary Gain, or 1250 Gain is.

My K-1 has a couple of extra pages of information, namely Long-Term Capital Gain amount, but also has a different amount for Transferred Capital (Total other Increases/Decreases).

There are several Footnotes as well that make no sense to me and I'm not sure what to do with them:

Section 199A, Schedule K-3, and Section 163(J)

They all say "Please consult your tax advisor.", but I don't have one.

Can someone please help me?

Thank you!

Mike9241

was this a publicly traded partnership where the disposition was reported on 1099-B? if no, ignore.

mellynleeAuthor

I did not receive a 1099-B, so I assume it wasn't publicly traded.

We have a Limited Partnership -- we invested $$ to purchase land, which was later sold.

So, are you saying we should ignore all the questions that TurboTax asks?

Put nothing for Purchase Date and Sale Date and the entire page requesting Regular Gain/Loss and AMT Gain/Loss?

Irish22_CPA

The doesn't sound like a publicly traded partnership - as it would have been purchased on a public exchange, and you would have received a 1099-B. You are a limited partner? What date was the purchase? Have you been reporting income/losses each year since purchase on the property on your 1040? These things are important to know to determine your cost basis - which would be purchase price plus gains and additional contributed capital, less losses and distributions.

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