Yes you are of course correct. I incorrectly took shortcut in my thinking.

I keep track of basis annually at the shareholder level. It's nonpassive.

So 2019 income to be shown on K-1 > 1040 Schedule E. And that's where I'll apply the Suspended loss to offset the income.

Please advise if I am incorrect in my procedure.

One hopefully last question. On K-1, should I include the 1099-C amount lumped together with ordinary business income (actually loss for 2019 Ops). Or put 1099-C amount on Line 10 Other Income.

Thanks so much