sale UCO (k-1, form 1065) tax question

UCO is a publicly traded partnership so here are some instructions

Enter the k-1 info
Check the PTP box
If total disposition proceed as follows:
Check final K-1 (s/b marked on actual k-1)
Check sold or otherwise disposed of the entire interest

On the k-1 disposition section (not the 8949/schedule d) for sales price use the ordinary income (sometimes you’ll see a column with the “751” or the words “Gain subject to recapture as ordinary income” or similar wording. This info comes from the supplemental sales schedule that should have been provided. It's also now on the k-1 box 20AB - no 20AB, no ordinary income upon disposition.

the following assumes there is 

The numbers I’m using represent the line numbers in forms mode (desktop only)
5. Sales Price = line 20AB (1065 k1)
6. Selling expenses = 0
7. Basis = 0
8. Gain is computed and should be the same as the sales price.
9. Ordinary gain = enter the sales price
This amount flows to form 4797 line 10 and is taxed as ordinary income. This step is necessary, so any suspended passive losses are now allowed.
10,11,12 should be blank

Now for the 8949.
The broker’s form is probably coded as B or E – sales proceeds but not cost basis reported to the IRS. This is because the broker does not track your tax basis. It used what you paid originally which is not correct.

The correct tax basis is:
What you paid originally, should be the same as what is on 1099-B as cost,
Then there is a column on the sales schedule that says cumulative adjustment to basis. If it’s positive add it to the original cost. If it’s negative subtract the amount. (some statements report your basis so you don't have to do the math - but this is before ordinary income recapture. 
Finally add the amount of ordinary income reported above, if any.
The result is your corrected cost basis for form 8949.

Some other things. Look at lines 20AB. That number should be added to the ordinary income above for reporting the 199A (qualified business income from the PTP). You don’t have to enter this but then you lose out on a tax deduction = 20% of this amount.

when you have a PTP and sell it, income/loss can be from 3 sources.

1) the K-1

2) ordinary income recapture on disposition from the sales schedule

3) capital gain or loss on disposition computed through using the sales schedule 

so if the k-1 reports $8000 of income that's taxable

if there is $5000 of ordinary income recapture that's taxable

if you have a $4000 gain from the sale that's taxable

$17,000 in all