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Matthew Breecher
Matthew Breecher, Certified Public Accountant (CPA)
Category: Capital Gains and Losses
Satisfied Customers: 286
Experience:  Director
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Received "Final K-1" forms from Boston Capital Tax Credit

Customer Question

Received "Final K-1" forms from Boston Capital Tax Credit Fund II Series 14 and Series 9. How do I calculate my adjusted basis in these?
Submitted: 5 months ago.
Category: Capital Gains and Losses
Expert:  Matthew Breecher replied 5 months ago.

Hello, I would like to help you with your question. Could you expand a little bit on your question. For instance, I am assuming this is a partnership? If so, your capital account should be on your K-1, Section L. This is your basis before liquidation. As you stated this was the "final" K-1, has there been a liquidation?

Customer: replied 5 months ago.
it's a partnership and the bot***** *****ne in Section L of the Final K-1 lists the ending capital account value to be "$0.00". And, a note on the reverse side of the K-1 sheet says, "In 2016, the partnership disposed of its interest in its eight remaining operating partnership investments". There's also this note of caution that's been included in every K-1:
"PARTNER'S CAPITAL ACCOUNT ANALYSIS - ITEM L. THIS IS A SUMMARY OF THE ACTIVITY IN YOUR CAPITAL
ACCOUNT. IT IS NEITHER AN INDICATION OF THE FAIR MARKET VALUE OF YOUR INVESTMENT NOR OF
THE PARTNERSHIP'S ASSETS."
Also, FYI, Section L of this 2016 Final K-1 lists the Beginning capital account as a negative amount and a Current year increase of exactly enough $$ to create the bot***** *****ne I said earlier was $0.00One more comment: My above use of "it" and "a" lie. As mentioned in my introductory message, there are TWO investments -- one mine, one my wife"s -- both Boston Capital Tax Credit Fund II but one is "Series 9", the other "Series 14". What I've said above applies to each.
Expert:  Matthew Breecher replied 5 months ago.

It sounds like your basis is zero based on the facts communicated. If your previous equity was negative, you probably had a loss that you reported in the prior year. As you current year is zero, they recorded just enough profit to clear the partnership capital accounts. I would assume there was some income then reported on your partnership K-1 in the current year?

Expert:  Matthew Breecher replied 5 months ago.

I hope I answered your question with sufficient detail, accuracy, and completeness based on the facts communicated. I would be happy to expand my answer should you need clarification. Accordingly, please rate my response, based on thoroughness and accuracy, rather than any good or bad news/content. We (the experts) are only compensated when an answer is accepted and rated with at least 3 stars; but my goal is your complete satisfaction and a 5 star rating. I appreciate your prompt response. Sincerely, ***** ***** Breecher, CPA.