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Use the amounts reported and the amounts

distributions made on the last day of the

on the attached schedule to help you figure

partnership’s tax year.

Box 20. Other Information

the net amount to enter on line 25 of Form

Your basis in the distributed marketable

6251.

Code A. Investment income. Report this

securities (other than in liquidation of your

Code F. Other AMT items. Enter the

amount on line 4a of Form 4952.

interest) is the smaller of:

•

information on the statement attached by

The partnership’s adjusted basis in the

Code B. Investment expenses. Report

the partnership on the applicable lines of

securities immediately before the distribution

this amount on line 5 of Form 4952.

Form 6251, Form 4626, or Schedule I of

increased by any gain recognized on the

Code C. Fuel tax credit information. The

Form 1041.

distribution of the securities or

partnership will report the number of gallons

•

The adjusted basis of your partnership

of each fuel sold or used during the tax year

interest reduced by any cash distributed in

for a nontaxable use qualifying for the credit

Box 18. Tax-Exempt

the same transaction and increased by any

for taxes paid on fuels, type of use, and the

gain recognized on the distribution of the

Income and Nondeductible

applicable credit per gallon. Use this

securities.

information to complete Form 4136, Credit

Expenses

for Federal Tax Paid on Fuels.

If you received the securities in

liquidation of your partnership interest, your

Code D. Look-back interest — completed

Code A. Tax-exempt interest income.

basis in the marketable securities is equal to

long-term contracts. The partnership will

You must report on your return, as an item

the adjusted basis of your partnership

report any information you need to figure the

of information, your share of the tax-exempt

interest reduced by any cash distributed in

interest due or to be refunded under the

interest received or accrued by the

the same transaction and increased by any

look-back method of section 460(b)(2) on

partnership during the year. Individual

gain recognized on the distribution of the

certain long-term contracts. Use Form 8697,

partners must include this amount on Form

securities.

Interest Computation Under the Look-Back

1040, line 8b. Increase the adjusted basis of

Method for Completed Long-Term

your interest in the partnership by this

If, within 5 years of a distribution to you

Contracts, to report any such interest.

amount.

of marketable securities, you contributed

Code B. Other tax-exempt income.

Code E. Look-back interest — income

appreciated property (other than those

Increase the adjusted basis of your interest

forecast method. The partnership will

securities) to the partnership and the FMV of

in the partnership by the amount shown, but

report any information you need to figure the

those securities exceeded the adjusted

do not include it in income on your tax

interest due or to be refunded under the

basis of your partnership interest

return.

look-back method of section 167(g)(2) for

immediately before the distribution (reduced

certain property placed in service after

Code C. Nondeductible expenses. The

by any cash received in the distribution), you

September 13, 1995, and depreciated under

nondeductible expenses paid or incurred by

may have to recognize gain on the

the income forecast method. Use Form

the partnership are not deductible on your

appreciated property. For property

8866, Interest Computation Under the

tax return. Decrease the adjusted basis of

contributed after June 8, 1997, the 5-year

Look-Back Method for Property Depreciated

period is generally extended to 7 years. See

your interest in the partnership by this

Under the Income Forecast Method, to

amount.

section 737 for details.

report any such interest.

Code B. Other property. Code B shows

Code F. Dispositions of property with

the partnership’s adjusted basis of property

Box 19. Distributions

section 179 deductions. The partnership

other than money immediately before the

will report your distributive share of gain or

property was distributed to you. In addition,

Code A. Cash and marketable securities.

loss on the sale, exchange, or other

the partnership should report the adjusted

Code A shows the distributions the

disposition of property for which a section

basis and FMV of each property distributed.

partnership made to you of cash and certain

179 expense deduction was passed through

Decrease the adjusted basis of your interest

marketable securities. The marketable

to partners with code F. If the partnership

in the partnership by the amount of your

securities are included at their fair market

passed through a section 179 expense

basis in the distributed property. Your basis

value (FMV) on the date of distribution

deduction to its partners for the property,

in the distributed property (other than in

(minus your share of the partnership’s gain

you must report the gain or loss and any

liquidation of your interest) is the smaller of:

on the securities distributed to you). If the

•

recapture of the section 179 expense

The partnership’s adjusted basis

amount shown as code A exceeds the

deduction for the property on your income

immediately before the distribution or

adjusted basis of your partnership interest

•

tax return (see the Instructions for Form

The adjusted basis of your partnership

immediately before the distribution, the

4797 for details). The partnership must

interest reduced by any cash distributed in

excess is treated as gain from the sale or

provide all the following information with

the same transaction.

exchange of your partnership interest.

respect to a disposition of property for which

Generally, this gain is treated as gain from

a section 179 expense deduction was

If you received the property in liquidation

the sale of a capital asset and should be

passed through to partners.

of your interest, your basis in the distributed

reported on the Schedule D for your return.

property is equal to the adjusted basis of

1. Description of the property.

However, if you receive cash or property in

your partnership interest reduced by any

2. Date the property was acquired and

exchange for any part of a partnership

cash distributed in the same transaction.

placed in service.

interest, the amount of the distribution

3. Date of the sale or other disposition of

attributable to your share of the

If you contributed appreciated property to

the property.

partnership’s unrealized receivable or

the partnership within 5 years of a

4. Your distributive share of the gross

distribution of other property to you, and the

inventory items result in ordinary income

sales price or amount realized.

FMV of the other property exceeded the

(see Regulations section 1.751-1(a) and

5. Your distributive share of the cost or

adjusted basis of your partnership interest

Sale or Exchange of Partnership Interest on

other basis plus the expense of sale

immediately before the distribution (reduced

page 1). For details, see Pub. 541.

(reduced as explained in the Instructions for

by any cash received in the distribution), you

The partnership will separately identify

Form 4797, line 21).

may have to recognize gain on the

both of the following.

6. Your distributive share of the

•

appreciated property. For property

The FMV of the marketable securities

depreciation allowed or allowable,

contributed after June 8, 1997, the 5-year

when distributed (minus your share of the

determined as described in the Instructions

period is generally extended to 7 years. See

gain on the securities distributed to you).

for Form 4797, line 22, but excluding the

•

section 737 for details.

The partnership’s adjusted basis of those

section 179 expense deduction.

securities immediately before the

If you receive cash or property in

7. Your distributive share of the section

distribution.

exchange for any part of a partnership

179 expense deduction (if any) passed

Decrease the adjusted basis of your

interest, the amount of the distribution

through for the property and the

interest in the partnership (but not below

attributable to your share of the

partnership’s tax year(s) in which the

zero) by the amount of cash distributed to

partnership’s unrealized receivable or

amount was passed through. To compute

you and the partnership’s adjusted basis of

inventory items result in ordinary income

the amount of depreciation allowed or

the distributed securities. Advances or

(see Regulations section 1.751-1(a) and

allowable for Form 4797, line 22, add to the

drawings of money or property against your

Sale or Exchange of Partnership Interest on

amount from item 6 above the amount of

distributive share are treated as current

page 1).

your distributive share of the section 179

-11-

Partner’s Instructions for Schedule K-1

Partner'S Instructions For Schedule K-1 (Form 1065) - Partner'S Share Of Income, Deductions, Credits, Etc. (For Partner'S Use Only) - 2004 Page 11

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