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Posted by Katie on April 8, 2008, 5:37 pm
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> I just got a K1, a week after I filed my tax return.
>
> The investment manager responsible for it says that, while he is not a tax
> accountant, it is of a trivial amount (no more than $20 one way or another)
> and is on an investment that was sold at a loss the same year it was
> purchased; so it can just be ignored.
>
> I sent the im's email to my accountant. He says that the IRS would not
> expect me to amend for something so trivial, and if necessary it can be
> dealt with if they send out a K-1 matching notice.
>
> I expect they know what they are talking about, especially when the
> accountant will make a tidy bundle by amending, but I don't want to get on
> the IRS's bad side. Any opinions?
> And what is a K-1 matching notice? A search was confusing.
>
Jessica, these K-1s were probably filed electronically, and the IRS
can do a computer run matching the SSNs/TINs on the K-1s with filed
returns to determine whether the K-1 income was reported by all of the
partners. This is similar to the runs they make matching tax returns
to 1099s, for example. That automated process may generate a letter
of inquiry from the IRS. If so, your accountant can respond to it.
In the meantime, you don't need to do anything. You won't get on the
IRS's "bad side."
Katie in San Diego
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