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I don't see how TT would do that,

Right. TT almost certainly doesn't adjust the basis. But your broker might adjust the basis before they put the figure out for TT to import.

Assuming no one has adjusted the basis and you need to do that yourself, here's the drill. You'll need all of the K-1s for the MLP since you purchased it. ...

There may be an easier way. If you are dealing with a PTP (and you probably are), you should receive a packet of information with your K-1. The first thing to do is look at item L on the K-1. If "tax basis" is checked, then the ending capital account value is your cost basis at the time of sale. Before you enter this number on Schedule D, you need to look for a worksheet in the packet that will allocate your gain/loss between capital gain and ordinary income. After you complete that worksheet you will have the numbers to enter on Schedule D and Form 4797.

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