This thread has been incredibly helpful! I'm dealing with a similar partnership property distribution situation and had no idea about Form 8308 requirements or the Section 754 election implications. One additional consideration I'd mention - make sure you review your partnership agreement's language around distributions before proceeding. Some agreements have specific valuation methods or approval processes that must be followed, even for distributions at book value. We discovered our agreement required unanimous consent for any property distributions, which we had overlooked initially. Also, regarding the K-1 footnotes, I found it helpful to include a brief description of the property being distributed (e.g., "Distribution of Unit 2A, 1-bedroom apartment") in addition to all the financial details everyone has mentioned. This makes it crystal clear what specific asset was distributed, which can be important if the IRS has questions later or if the partner needs to reference the distribution for future tax purposes. The documentation suggestions about getting an appraisal are spot-on. Even though it's an additional expense, it's much cheaper than dealing with an IRS challenge down the road if they question your valuation.

This is exactly the kind of situation where having a solid understanding of partnership tax law becomes critical. I went through a similar property distribution two years ago with our 5-partner real estate LLC, and there are a few additional considerations that haven't been fully addressed yet. First, regarding the Section 734 adjustment that @KylieRose mentioned - even if you don't have a Section 754 election in place, you should seriously consider whether making it now makes sense. The election applies to the tax year it's made, so you could still benefit from basis adjustments on this distribution. With 15% appreciation, the math might work in your favor, especially if you have other depreciable assets in the partnership. Second, don't overlook the potential for "hot assets" in your distribution. Even though you're distributing real property, if there are any Section 1245 or 1250 recapture amounts, or if the property generates ordinary income, there could be complications. Make sure your tax professional reviews whether any portion of the distribution could be treated as ordinary income rather than capital. Finally, consider the timing of this distribution relative to your partnership's tax year end. If you're distributing near year-end, you'll want to make sure all the depreciation allocations are properly calculated through the distribution date. This affects both the partnership's final depreciation deduction and the basis of the distributed property. The K-1 reporting everyone has discussed is spot-on, but I'd add that you should also consider providing the departing partner with a detailed statement showing exactly how their final capital account was calculated. This becomes invaluable documentation if there are ever questions about the transaction.

One thing to be aware of - the 50% limitation on business meal deductions temporarily changed for 2021 and 2022. Restaurant meals were 100% deductible during those years as part of COVID relief. But for 2025 tax filing, we're back to the standard 50% deduction for business meals. Just wanted to mention this because I've seen some outdated articles still circulating that mention the 100% deduction.

As someone who's been through an IRS audit specifically related to business meal deductions, I can't stress enough how important contemporaneous documentation is. The auditor told me that receipts alone are never enough - they need to see evidence that you recorded the business purpose and attendees at the time of the meal, not months or years later. What saved me was that I had developed a habit of writing brief notes on the back of receipts immediately after meals. Things like "Lunch with Sarah Chen, potential web design client - discussed project timeline and budget requirements." The auditor was satisfied with this simple approach. One tip that might help others: if you're uncomfortable writing business details on receipts in public, just jot down initials or a code word that will remind you later, then expand on it when you get back to your car or office. The key is creating that paper trail showing you documented things in real-time, not reconstructed them during tax prep.

Has anybody calculated whether it's still worth adding your partner to your insurance after all these extra taxes? I'm doing the math and it seems like separate marketplace insurance might be cheaper once you factor in the tax hit.

Great breakdown from everyone! Just want to add that timing matters too - if you're adding your partner mid-year, the imputed income will be prorated for the months they're covered. So if you add them in July, you'd only have 6 months of imputed income added to your W-2. Also, don't forget that the imputed income affects more than just your federal taxes. It also increases your Social Security and Medicare tax liability since those are calculated on your total taxable income. In the original example with $630/month extra employer contribution, that's an additional $580 per year in FICA taxes (7.65% of $7,560). One last tip - if your company offers an HSA with your health plan, the increased coverage cost might make you eligible for higher HSA contribution limits since you'd be switching from self-only to family coverage. The extra tax-deductible HSA contributions could help offset some of the tax impact from the imputed income.

This is such a comprehensive discussion - really helpful for anyone dealing with precious metals taxation! I just wanted to add one more consideration that might be relevant for your situation. Since you mentioned the coin has appreciated nicely over the past several years, you might want to think about whether this sale fits into any broader investment or financial planning strategy. While the tax implications are important (and everyone here has covered those thoroughly), sometimes the timing of when to realize gains depends on your overall financial picture. For example, if you're planning any major purchases or have other financial goals coming up, the after-tax proceeds from this sale might be useful. On the other hand, if you don't need the cash immediately and believe gold might continue appreciating, the 28% collectibles rate is pretty steep compared to other investment options. Also, since you've been holding it for several years and clearly know how to store and maintain precious metals properly, you might consider whether this is a one-time sale or if you're thinking about adjusting your overall allocation to precious metals. The tax treatment will be the same for any future gold coin sales, so understanding the process now (which you clearly do based on all the great advice here) will serve you well. Either way, you seem very well prepared with documentation and understanding of the tax implications. Good luck with whatever you decide!

I've been following this discussion and wanted to share something that might be helpful for anyone dealing with precious metals taxation questions. While everyone has covered the tax implications really well (yes, you need to report even a single coin sale, and yes, it's subject to the 28% collectibles rate), I wanted to mention that if you're looking for personalized guidance on your specific situation, there are some good resources available. I recently used a service called TaxGPT (https://taxgpt.com) when I had questions about selling some inherited silver coins. What I liked about it was that it could analyze my specific situation - including the inheritance aspect, basis calculation, and state tax implications - and give me clear, personalized guidance rather than just general information. The tool walked me through exactly how to handle the inherited basis (stepped-up to fair market value at date of death), what forms I needed to file, and even helped me understand the record-keeping requirements. It was especially helpful because inherited precious metals have some unique considerations that general tax advice doesn't always cover well. For your situation with a straightforward purchase and sale, you probably have all the information you need from this discussion. But if you want to double-check your approach or get confirmation that you're handling everything correctly, it might be worth looking into specialized tax guidance tools that can account for the nuances of precious metals transactions. Either way, you're clearly well-prepared with your documentation and understanding of the process!

I went through this exact same situation last year with my 14-year-old daughter who had about $18 in capital gains from a stock split cash payment. After researching extensively and consulting with my CPA, here's what I learned: The IRS Publication 929 does provide some flexibility for "incidental" capital gains when using Form 8814. While the form doesn't explicitly mention regular capital gains, there's guidance that allows including small amounts that don't materially affect the tax calculation. For your $22 gain, I'd recommend including it on Form 8814 line 1a with your daughter's other unearned income. The key factors that support this approach: 1. The amount is less than 1% of her total income 2. It won't change her tax liability in any meaningful way 3. Filing a separate return would create unnecessary administrative burden Just make sure to keep good records showing the 1099-B and your reasoning for including it on Form 8814. In the unlikely event of any questions later, you can demonstrate that you made a reasonable interpretation based on the circumstances. The practical reality is that the IRS isn't going to scrutinize a $22 capital gain on a child's return, especially when it's clearly reported and the family is making a good faith effort to comply with the tax laws.

I just wanted to chime in as someone who's been through this exact scenario multiple times with my three kids over the years. The $22 capital gain from fractional shares is such a common situation now with so many brokerages handling stock splits this way. Here's my take after dealing with this probably 6-7 times: include it on Form 8814. I've never had any issues doing this, and I think the reasoning others have shared here is sound. The IRS has bigger fish to fry than a $22 capital gain on a child's return, especially when you're clearly trying to report everything properly. What I do is keep a simple spreadsheet each year documenting these decisions. For example: "2024 - Daughter Sarah - $22 LT capital gain from XYZ Corp fractional shares included on Form 8814 line 1a due to de minimis amount (0.9% of total unearned income)." Takes 30 seconds and gives you documentation if you ever need it. The key is being consistent and reasonable. If next year she has $500 in capital gains, then I'd file separately. But for these tiny amounts from fractional share payouts? Form 8814 all the way.