investment partnership

[JackW]

An investment partnership makes a distribution of marketable securities.  What information do I need to include on the partner's K-1?  Do I need to code it on the K-1 or is it considered supplemental information?  It is not a liquidating distribution.

[George4Tacks]

It is a distribution, just like cash, but with a value of basis of the shares as the distribution.  I would suggest a supplemental statement of the shares distributed and the basis of those shares. 

[sjrcpa]

I think the distribution is done at FMV, but the partner's basis in these shares is the partnership's basis.

[JackW]

I agree with you that  the distribution of the marketable security from an investment partnership is  just like cash, but with a value of basis of the shares as the distribution. .  I also  included a supplemental statement of the shares distributed and the basis of those shares on the K-1 plus the fact that these shares are considered long term.

I am a bit confused as how to enter this on lacerte.  Do I need the supplemental statement for the K-1 and also the following.

I looked at Form 1065, Screen 32.1, Distributions, Distributed Marketable Securities.  That section includes "Enter Total Distribution Details".  Do I need to enter any information on this screen?

See also screen 28, Distributions. This is the place that I entered the total marketable security distributions for Sch M-2.  When I click on   "Enter Total Distribution Details", it takes me to screen 32.1.  

Thanks so much.

[George4Tacks]

I am going to agree with @sjrcpa that the distribution is at FMV at the date of distribution.

Did you press F1 for details on those entry points?  28 is the total and 32 is the specifics for each partner. 

Distributed Marketable Securities Details: Fair market value

Schedule M-2 (Capital Account)

Screens 28; Codes 114,1114

Distributions of marketable securities treated as money require the details of each security be shown on the return (Schedules K and K-1). Enter each securities description, the partnership’s adjusted basis immediately before the distribution, and the fair market value of each security distributed for Schedule K reporting.

IMPORTANT:

Each partner’s/member’s share of the distribution, and related supporting details, MUST be entered in the Schedule K-1 Miscellaneous screen to properly complete Schedules K-1. Continue to specially allocated Distributions in Screen 29 for all program calculations.

These entries ONLY affect what prints on Schedule K Supplemental Information.

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Distributed Marketable Securities Details (Partner): Fair market value

Partner Sch. K-1 Misc. Information

Screen 32; Code 62

Distributions of marketable securities treated as money require the details of each marketable security be shown on the return (Schedules K and K-1). Enter each partner’s share of the marketable security description, the partnership’s adjusted basis immediately before the distribution, and the fair market value of each property distributed for Schedule K-1 reporting.

IMPORTANT:

The total amount of the distribution, and related supporting details, MUST be entered in the Schedule M-2 screen to properly complete Schedule K.

These entries ONLY affect what prints on the partner’s Schedule K-1 Supplemental Information. Continue to specially allocated Distributions in Screen 29 for all program calculations.

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