Individual investor with a large K1 loss.

Member since 2018 · 28 posts · 11 votes

I am not sure how to ask or propose my question, but I invested with a big pool of investors in a large apartment complex in San Antonio. I just got a K1 form and it shows a huge loss. Do I file that on my tax returns?

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Alina Trigub

Rental Property Investor · Glen Rock, NJ · Member since 2015 · 3k+ posts · 2k+ votes

@Nathan Nance

Don't worry, there are special rules to be able to apply such losses. So if you are a high W-2 earner or have no passive income, chances are most if not all of it will be carried forward. So that's a good thing since it will allow you to utilize it later.

Some of it is explained in the following article:

https://www.biggerpockets.com/member-blogs/10850/81273-how-to-pay-less-in-taxes

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Jaysen Medhurst
Rental Property Investor · Greenwich, CT · Member since 2015 · 4k+ posts · 2k+ votes
6y
Yes, you do, @Nathan Nance. Those losses can be used to offset other passive income. They will also be carried forward indefinitely.
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Taylor L.
Rental Property Investor · RVA · Member since 2016 · 5k+ posts · 4k+ votes
6y
There are lots of potential advantages to that depending on your situation. You're best off talking with a CPA about your situation to see what advantages are available to you based on how you file and the full scope of your investments. This is a pretty common scenario, every syndication I've been in has had such a situation in year 1.
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Alina Trigub
Rental Property Investor · Glen Rock, NJ · Member since 2015 · 3k+ posts · 2k+ votes
6y
@Nathan Nance
Don't worry, there are special rules to be able to apply such losses. So if you are a high W-2 earner or have no passive income, chances are most if not all of it will be carried forward. So that's a good thing since it will allow you to utilize it later.
Some of it is explained in the following article:
https://www.biggerpockets.com/member-blogs/10850/81273-how-to-pay-less-in-taxes

3 Reply
Alex Olson
Real Estate Broker · Kansas City Metro · Member since 2015 · 2k+ posts · 1k+ votes
6y
@Nathan Nance Definately speak to a great real estate CPA for your K1 loss. They can ensure you are set up to maximize your loss.
1 Reply
Matt Millard
Lewisville, TX · Member since 2015 · 341 posts · 264 votes
6y
What if you build a crazy high amount like $400k? Any ways to quickly start reversing that?
0 Reply
Basit SiddiqiBusiness Member
Accountant · New York, NY · Member since 2015 · 8k+ posts · 3k+ votes
6y
@Nathan Nance

You are required to report the information on your K-1 onto your tax return.
Depending on our level of activity with the partnership, you may need to carry the loss forward.
You also want to make sure what states the partnership does activity in. If you received state K-1's, you may need to consider filing additional state returns.

If you filed your return already - you may be required to file an amended return.
[email protected]917-280-8544
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