tmike Posted April 19, 2008 Report Share Posted April 19, 2008 I have a tax client that has disposed of all of his units in a ptp. He also received a K-1 for his proportional share of losses for TY 2007. Do I need to adjust his cost basis in any way for Sch. D? He had a $1030 section 1256 loss that is reported on form 6781. Thanks for any help. -Mike in MN- Quote Link to comment Share on other sites More sharing options...
JRS Posted April 19, 2008 Report Share Posted April 19, 2008 Along with his K-1, he should have received a "2007 Sales Schedule", which should, normally, have 10 columns. If he had the PTP for any length of time, there should be adjustments to the basis and a break out of "ordinary gain" and capital gain. If he had a straddle loss, he probably had a powershares currrency fund. Quote Link to comment Share on other sites More sharing options...
tmike Posted April 20, 2008 Author Report Share Posted April 20, 2008 Along with his K-1, he should have received a "2007 Sales Schedule", which should, normally, have 10 columns. If he had the PTP for any length of time, there should be adjustments to the basis and a break out of "ordinary gain" and capital gain. If he had a straddle loss, he probably had a powershares currrency fund. He did not own the fund very long. Less than 1 year. There was only a "2007 ownership schedule". This only showed dates that he bought and sold units in the ptp. His capital account was adjusted but I am not clear on how to calculate basis for sale of ptp. He had a capital gain on the disposition because the market value had increased on this particular partnership. -Mike in MN- Quote Link to comment Share on other sites More sharing options...
JRS Posted April 20, 2008 Report Share Posted April 20, 2008 I would see if his PTP has a website so you can look at the client's tax package. Most PTP's have a site. This might be the exception to the rule, but I have never seen a final K-1 on a PTP without a sales schedule, even on a short term hold. I had one this year, the client held it for one month and still got a K-1 with a sales schedule. There was no change in the basis, as the client did not have any distributions, but still received it with -0- in the adjustments column. In my cases, the capital account is increased or decreased by the total of Box 1 - box 5 - box 6. I reduce the basis in most cases (or increase) by this amount. As with everything else in our busines, this is not always correct and someone else might do it differently and tell me I am wrong. But, I have had clients audited on PTP's, among other things, and never had a problem. Quote Link to comment Share on other sites More sharing options...
tmike Posted April 20, 2008 Author Report Share Posted April 20, 2008 Thanks JRS, I appreciate the help. -Mike in MN- Quote Link to comment Share on other sites More sharing options...
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