Re: Computing Capital Gains in MLP
from pshonore on MLP bd:
OK Guys - one more time.
Take your original purchase price and add the basis adjustment to it. Since the basis adjustment is
usually negative, this will lower your basis. Take your sale proceeds and subtract your adjusted
basis you just calculated to get total gain. The MLP has told you the amount of ordinary gain so
subtract that from total gain to get cap gain/loss. The ordinary gain goes on Form 4797 Part 2.
The Cap gain /loss goes on Form 8949. All this is on the Sales Schedule supplied with your K1,
including the above instructions.
If your using TT, tell it you made a complete dispospositon of the MLP. On the resulting form
enter the sale proceeds, adjusted basis, sale and purchase dates and amount of Ordinary gain.
TT will do the rest. Check form 4797 and Form 8949 for accuracy and aslo check that any
previously unallowed losses show up on Schedule E.