Video instructions and help with filling out and completing Will Form 1065 Schedule M 3 Reconciliation

Instructions and Help about Will Form 1065 Schedule M 3 Reconciliation

Disclaimer I've done intensive research on how to file Schedule k1 and 1099 be the steps to show you to avoid duplication reporting for the partnership ETF it is for your reference you need to do your own diligence and consult your tax advisor to determine how you should file when you purchase partnership etf brokers 1099 be will report gain or loss of your investment included in total amounts schedule k-1 issued by the partnership will report gain or loss as well both 1099 B and schedule k-1 are required to be filed after you complete both you need to adjust the tax basis in 1099 B to avoid duplication of reporting capital gain or loss on these ETF step one complete 1099 be from your broker in 1099 B there are total amounts of proceeds cost wash sale loss disallowed all these amounts need to be reported exactly $10.99 be sent from broker to you in IRS has total amounts these total amounts include partnership etf gain or loss worksheet 8 949 sent from broker is detailed report supporting 1099 be eight-nine 49 is very helpful when you file the return when you use tax software gain or loss on the sale of investment this is how to file box a total line in 8949 these numbers you need to enter into the software in this screen I highlighted as red since this includes whole year just enter the beginning of the year in the end of the year you also need to enter wash sale not allowed amount find box be total line in 8 949 these numbers you need to enter into the software in this screen I highlight it as red note box B column e cost and other basis amount is not sent to IRS so this is the place you do adjustment for partnership ETF $8,100 boxbee total is what I used to illustrate the calculation throughout this video after you completed all boxes in eight nine forty nine you reported gain or loss for your investment for partnership ETF at this step step two complete schedule k-1 issued from the partnership look at the schedule k-1 the left side has a 2m + right side top two boxes final k1 and amended k1 the right side has boxes 1 to 20 this information helps you to answer the questions through tax software to file Schedule k1 you go to partnership income form 1065 schedule k-1 when you see this screen click yes to fill up left side of schedule k-1 pay attention to how to enter percentage amount pay attention to how to enter withdrawal amount when you see the screen click checkmarks to all the boxes you have a mountain and follow to enter the amounts in next pages when you finish choose all investment is at risk and finish the remaining questions now you report a gain or loss that partnership pass to you at this step after step one and two you reported twice gain or loss through 1099 be and schedule k-1 gain or loss of 1099 be is the difference between your proceeds and cost basis gain or loss of schedule k-1 is to partnership gain or loss passing to you based on your shares and holding period because during this period you are the passive partner these two are different concepts step 3 find out how much is the adjustment and go back to 1099 be to adjust check schedule k-1 first to understand some concepts notice line L on the left side the current increase is 138 on the right side box 8 is 92 box 11 C is 48 totaling 140 box 13 K is 2 this is schedule k-1 preparation fee so you need to subtract it all boxes total 138 left side equals right side now check some final pages of schedule k-1 you will see column 5 or 6 titled cumulative adjustment to tax spaces add all the numbers together you will get a total of 138 a positive number in this example so through schedule k-1 you have reported a gain 138 but you also reported a gain or loss through 1099 b in our example we have cost basis 8100 for box be from 8949 schedule k-1 tax basis is positive 138 so we need to increase cost basis to take out duplicate gain in 1099 be new cost 80 100 plus 1 38 equals 82 38 this is vice-versa scenario if schedule k-1 cumulative adjustment to tax basis total is- a loss you add the amount back to 1099 be in our example you need to change 8100 cost basis 270 962 to avoid duplicated loss you if partnership ETF was not sold at the end of year and it runs over multiple years it will tie at the year you sold the etf difference will carry over to next year you just use tax spaces amount to do the adjustment on the following I have used real examples to show you how multiple years work just read every note I have on the screens Music Music Music Music Laughter Music Music Music here I show you how the multiple numbers you entered will end up in the places of 1040 form Music if you want to avoid schedule k-1 you need to know which etf has partnership in nature if you google a list of ETFs that issue k1 you will see quite a long list just to name a few popular partnership nature ETFs that will issue schedule k-1 before you file the return the software were asked you to run alerts to verify what you entered it will alert you for the wash sale just ignore because this is not an error and you need to enter the amount to tie to 1099 be Music