On recent Forms 1065, Schedules K-1, K-2 and K-3 and in related instructions, the IRS has launched massive new reporting requirements re: negative tax basis capital accounts, at-risk activities, passive activities, partner level built-in gains, foreign activities and many more. Chaos has resulted.
In this course, you’ll learn:
1. How partnerships (and S Corps) face the at-risk (and passive) activity reporting blues (and what to do about them)
2. Negative tax basis capital account reporting – What must be computed and disclosed (and by when)
3. Plethora of other new info required (built-in gains lying in wait, disregarded entity partners, international activity, foreign tax credit and more)
Publication Date: October 2022
Designed For
Return preparers, tax planners and taxpayers desiring to keep up with IRS’s Form 1065 Schedule K-1 reporting requirements.
Topics Covered
- Form 1065 and K-1 — New reporting requirements in depth
- Disregarded entity partners — Disclosures, depth of implications
- 3 year average annual gross receipts test — 4 places it matters
- Negative capital accounts — Tax basis reporting
- Basis in partner's partnership interest — New inquiries, new treacheries
- Disguised sales — New question as to partner disclosure
- Aggregation of at-risk activities — New disclosures with sticky implications
- Grouping of passive activities — New disclosure and detail required
- Miscellaneous — Capital accounts, §754 elections with §743(b) adjustments, sales of partnership interests, partnerships with foreign partners, tiered partnership debt disclosure issues, and so on
Learning Objectives
- Recognize the reporting demands of Form 1065 Schedule K-1
- Identify when the IRS first introduced Schedule K-2 and K-3
- Identify the new schedule that relates to a partners distribute share of international items
- Identify the per partner per month FTF penalty for a partnership return required to be filed in 2023 (not to exceed 12 months)
- Identify the IRS form that relates to a notice of inconsistent treatment or Administrative Adjustment Request (AAR)
- Identify the part of Schedule K-2 that relates to the Foreign Tax Credit Limitation
- Identify the item of income that is sourced to the residence of the payer
- Identify the IRC Section that prescribes requirements related to the failure to furnish correct payee statements
Level
Update
Instructional Method
Self-Study
NASBA Field of Study
Taxes (3 hours)
Program Prerequisites
Basic understanding of tax preparation.
Advance Preparation
None
Instructor
Bradley Burnett
Bradley Burnett, J.D., LL.M., is a practicing tax attorney, licensed in Colorado, with 38 years of tax practice experience. His practice emphasis is on tax planning and tax controversy resolution. Prior to establishing his own law firm in 1990, he practiced tax accounting with national and local CPA firms, worked as a trust officer for a Denver bank, and managed the tax department as partner in a medium-sized Denver law firm. After receiving his undergraduate degree in accounting and law degree (J.D.), he earned a Master of Laws (LL.M.) in Taxation from the University of Denver School of Law Graduate Tax Program.
Mr. Burnett has delivered more than 3,400 presentations on U.S. tax law throughout all 50 states, Washington, D.C., the Bahamas, Italy, Greece, Turkey and Canada. He has authored texts of 45 CPE courses. Mr. Burnett served as adjunct professor at the University of Denver School of Law Graduate Tax Program, where he pioneered an employment tax course and taught IRS practice and procedure. He has appeared on television answering tax questions for call-in viewers of Denver NBC affiliate KUSA Channel 9. Brad received the Illinois Society of CPAs Instructor Excellence Award for teaching in Chicago and five times has been the top rated, most requested instructor for CPA Society annual tax conferences.