New Circumstance for me. I think I understand how to be reported but would appreciate input from others who have seen this before.
Client made some short term trades of Proshare ETF's. Received 1099-B from Ameritrade reported realized gains for the sales made in 2011.
Now today when the client came to pick up his returns, he brought a stack of K-1 (1065)'s that he got in the mail today.
Reading the information that came along with the K1, it says that, "Proshare ETFs are treated as partnerships for tax purposes. Unlike mutual funds and most ETFs, which make payments of inc and CG and report them on 1099-Div, these must be reported on K1's.
I am assuming that like Capital Gains reported on the 1099-Div's, these are gains realized internally for the ETF at the time they sold a holding within the fund. Like mutual funds, all gains flow through to the shareholders at that time. These are then reported on Sch D just like capital gains would have been if reported on a 1099-DIV.
Seems straight forward but wanted another opinion as I have not seen this before. Thanks in advance for your feedback.
PS Client also rec'd mutiple K1's for the same ETF's but for Roth and Trad IRA's. As such, I assume no reporting is required on tax forms.
Client made some short term trades of Proshare ETF's. Received 1099-B from Ameritrade reported realized gains for the sales made in 2011.
Now today when the client came to pick up his returns, he brought a stack of K-1 (1065)'s that he got in the mail today.
Reading the information that came along with the K1, it says that, "Proshare ETFs are treated as partnerships for tax purposes. Unlike mutual funds and most ETFs, which make payments of inc and CG and report them on 1099-Div, these must be reported on K1's.
I am assuming that like Capital Gains reported on the 1099-Div's, these are gains realized internally for the ETF at the time they sold a holding within the fund. Like mutual funds, all gains flow through to the shareholders at that time. These are then reported on Sch D just like capital gains would have been if reported on a 1099-DIV.
Seems straight forward but wanted another opinion as I have not seen this before. Thanks in advance for your feedback.
PS Client also rec'd mutiple K1's for the same ETF's but for Roth and Trad IRA's. As such, I assume no reporting is required on tax forms.