Description

Avoid common errors

Partnership tax returns

Understand common errors practitioners make in preparing partnership tax returns that are often missed during the review process.

Familiarize yourself with the new K-2 and K-3 requirements for partnerships.

Sharpen your reviewer skills by examining case studies and discussing complex LLC and partnership issues often missed by staff tax return preparers.

Implement your learning using case studies to increase your comprehension and retention.

Instructor: Deborah Phillips

Target Audience

partners and managers in CPA firms

Experienced CPA staff

Course Objectives

Calculate the balance in the partners' capital accounts and enter the results on Form 1065 and on the Schedule K1s.

Identify the purposes of Schedules L, M1, and M2.

Recognize the tax treatment, both at the partner and the partnership level, of guaranteed payments to a partner.

Calculate the amount of the guaranteed payment when the partner is to receive the lesser of a fixed dollar amount or a fixed percentage of partnership income.

Identify and report Section 1202 gains on Form 1065.

Calculate the ordinary loss to the partners from the sale of Section 1244 stock.

Determine how installment sales are taxed and disclosed by partnerships.

Analyze the consequences when a new partner joins the partnership.

Prepare a balance sheet following a revaluation of LLC or partnership assets.

Make appopriate allocations of book and tax income following the entry of a new partner to a partnership during a taxable year.

Compute book depreciation expense following the revaluation of a partnership's assets.

Properly allocate depreciation expense among the contributing and noncontributing partners under Section 704(c).

Apply the provisions of Section 737 and make associated adjustments to the basis of property retained by the partnership.

Determine the tax basis of distributed property in the hands of the recipient partner.

Calculate the required basis adjustments under Section 734(b) when a partnership distributes property to a partner in liquidation of his interest.

Allocate the Section 734(b) adjustment, if any, among properties retained by the partnership following a distribution of property.

Allocate nonrecourse liabilities among the partners in a partnership.

Subjects

We will cover common errors made involving the following:

Form 1065

Schedules K and K1

Schedules M1 and M2

Calculating recourse and nonrecourse liabilities

Partner inside and outside basis

Partner's capital account analysis

IRC Sections 704(b), 704(c), 721, 722, 732(b), 734(b), 737, 743(b)

Prerequisites

CPAs working with clients requiring up-to-date expertise in partnership taxation for the current tax season