My question is simple enough, but I've been unable to get a straight answer, even from so called 'tax professionals'.
Q. What items of the IRS basis adjustment worksheet in the "Partner's Instructions for Schedule K-1 (1065)" on page 2 do I use to adjust the basis of my PTPs?
IRS Pub 541 does not indicate there are special rules for PTPs, while Pub 925 and the instruction for the 8582 and Sch E do have 'special instructions for Publicly traded partnerships' but only talk about 'at risk' and 'passive limitations'. One tax guide says to use items 1, 2, 7 and 12 of the worksheet only for PTPs. Indicating that only the distributions, K1 box 19 adjust the basis for PTPs, and yet the IRS Partner's instructions do indicate K1 box 18 items if present are also used to adjust the basis..
I need a simple answer for this simple retail investor of PTPs.