tax booklet for 2009 is available on Businesswire.
This year OID interest component of trust distributions is negative (also for WHX) and I'm having difficulty finding a way to get it into Turbotax.
Would anyone who has done taxes for MVO or WHX like to say where in Turbotax you enter
(the return of principal part is clear - that just goes on schedule D with cost basis equal to proceeds).
To make it worse, the brokerages don't seem to know how to report it either. I have MVO at two brokerages who report the distributions differently and neither of them consistent with what the tax booklet tells you to do.
You do indeed have to put part of the distribution in schedule D because it is repayment of principal.
Yes, MVO and WHX are different - they are not partnerships with K-1s and neither do they pay royalties. There is no one place in Turbotax to enter the information for these - you have to put details in a few different places.
P.S. I wasn't floundering at all. Just having trouble with a negative interest amount reported this year. I subsequently found a way to get it entered though.
I made suggestions because you were obviously floundering -- talking about putting the stock income on to schedule D?????!!! That is what I call bizarre. I work with Turbo Tax and have never encountered the entity that you describe -- if it is on there, I haven't seen it. Most of the trusts associated with LLC's are straight forward -- its either a K-1 or a 1099 misc filing. You needn't be asinine about someone trying to point you in the right direction. Perhaps that is why you are going around and around and getting nowhere.
You seem to know how to handle WHX and MVO.
Have you got as far as deciding how you are going to handle the negative interest on these trusts this year?
The whole thing seems bizarre to me. On WHX the return of principal is more than the total distributions due to the negative interest.
Actually that wasn't the problem. Not sure why you made so many suggestions when you don't even know what this is.
The main point was how to handle it that the interest amount repaid from the trust to the investor is negative in 2010. I've also been asking this on the WHX board and I'm coming to the conclusion that I may have to hold over the negative interest till next year.
Another point was the MVO hedging income, but I think that should be reported as miscellaneous income. Unfortunately I think I cannot use that income to offset the negative interest income from the same payer.
Never heard of them, but that is not unusual. Then, I don't see what the problem is -- put the information on a 1099 misc in Turbo Tax. The pro-rated loss can be taken on the Schedule E as mentioned previously. I think that this was her problem -- how to report her share of the overall company loss.
Not really, MVO (and WHX) are WHFIT organizations (Widely Held Fixed Investment Trust). They do not report on a K-1, they report on a 1099. As Lisa pointed out previously, the investment is treated very similarly to a mortgage. Payments received are consider to be interest and return of principal.
On your question of where to report business expenses etc. on oil revenue distributions or royalties -- Turbo Tax will explain if you look to the help section. Royalties, if not reported on form 1099 Misc. (usually these are reported on what are called "Consolidated Forms 1099) when made part of a brokerage annual 1099., report royalties on Schedule E as business income. All of the expenses etc. can be reported there as well. Dividends are reported on the Schedule B along with other income like interest etc. Capital gains (sales etc.) are reported on Schedule D.
I hope this helps you.
Thanks for trying, but no it doesn't help because MVO (and WHX) have a different structure than the royalty trusts and they do not pay 'royalties' (or dividends).
In fact, it is treated as though you gave a loan to the trust and they pay you back interest plus principal. I own several of the typical kind of royalty trusts and I know how to handle them. But MVO and WHX are more difficult to understand.
Especially this year where the interest amount paid by the trust is actually negative.