Capital Gains and Losses
Questions and comments about tax rules for buying and selling stocks, mutual funds, real estate and other assets.
ETF K-1 form
Posted by: kurtsang, January 25, 2017 09:00PM
I have a ETF that I purchased 5 years ago. For the past 5 years I always got a K-1 form which I used to prepare my taxes.

This past year I sold that ETF. I have never sold an EFT that used a K-1 form before. Will I need to fill out schedule D to figure my capital gain or loss using my purchase data and sell date like you would on a normal mutual fund? Or will I need to only complete the K-1 they send me? Or do I have to do both?

Re: ETF K-1 form
Posted by: lawnguy44, March 8, 2017 07:19PM
Yes, you will need to fill out Form 8949 (which feeds Sched D) and be sure the sales proceeds match the entry for the ETF on your 1099B which you should have received from your broker. Also pay close attention to Box 11C on the K1 (assuming is a "commodity" ETF).

You can find the schedule for when you will receive the K1 at either of the following (depending on which one prepares it):

Re: ETF K-1 form
Posted by: kurtsang, March 11, 2017 06:54PM
It is a commodity ETF that I sold.

I received a form 1099B and it is all zero's.

I received a summary of Proceeds Gains and Losses from my broker which says to report on form 8949. It shows proceeds which I sold of $10,000 and the cost basis of $22,000 Which means I would have a loss of $12,000.

But over the past 6 years I completed a schedule K-1 for my taxes. Each year in box 8 (Net Short Term Loss) and box 9a (Net long term loss) and 11C (Other income loss) showed losses in these boxes. When I total box 8, 9A and 11C for the 5 years they total $5,800.

Do I fill out for 8949 as a $12,000 loss or do I need to take the $12,000 and subtract the $5,800 losses from the previous years making the total loss on form 8949 of $6,200 ?

Re: ETF K-1 form
Posted by: assassin, March 11, 2017 08:48PM
the K-1 should include a Sales Schedule that says how much to adjust your basis in shares, as well as how much (if any) of the remaining gain is Ordinary Gain that belongs on a different Form (e.g. 4797).

Re: ETF K-1 form
Posted by: kurtsang, March 12, 2017 02:25PM
They are asking for an adjustment code on form 8949. On my summary of proceeds for gains and losses from the broker they have it listed as long term E (basis not reported to IRS) Do I use E as the adjustment code?

Re: ETF K-1 form
Posted by: lawnguy44, March 12, 2017 04:09PM
Generally speaking, commodities ETFs do not run an operating business and do not have depreciation so recapture (a/k/a ordinary income) should not apply.

I don't understand why your 1099B has all zeros if you bought or sold a security in 2016. I believe you only need an adjustment code if you're reporting different numbers than the Broker 1099B. As they did not report basis, I don't believe your numbers differ. However sale proceeds on all 1099B forms should match what is in Col D, Parts I and II

If you're reported losses in previous years, I would definitely think that would require a basis adjustment which should be on the Sales Schedule. You can look on your K1 forms from previous years and check the Ending Cap Account balance in Part II Section L to get some idea of how your basis has changed over the years.

Re: ETF K-1 form
Posted by: kurtsang, March 13, 2017 11:53PM

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