Reviewing Partnership Tax Returns: What Are You Missing?
Presenter
Gregory Carnes,
Accounting Professor,
University of North Alabama
Overview
The partnership section of the Internal Revenue Code is arguably one of the most complicated. That complexity and the reliability of tax software to properly handle it can create many issues for you and your staff when processing your client's LLC and partnership tax returns. Join us as we discuss the common errors practitioners make on partnership tax returns that are often missed by review staff. The intent is to sharpen skills for reviewers by examining case studies and discussing issues in which additional information from the client may be warranted and areas of tax law in which proper treatment requires additional analysis and information. Multiple issues will be discussed, including income; deductions; and K-1, K-2 and K-3 reporting. This course follows a highly illustrative case-study format to increase participant comprehension and retention.
Learning Objectives:
- Identify common mistakes made on partnership tax returns.
- Calculate the balance in the partners' capital accounts and enter the results on Form 1065 and on Schedule K-1.
- Identify the purposes of Schedules L, M-1 and M-2.
- Recognize the tax treatment, both at the partner and the partnership level, of guaranteed payments to a partner.
- Identify and report Section 1202 gains on Form 1065.
- Determine the ordinary loss to the partners from the sale of Section 1244 stock.
- Determine how installment sales are taxed and disclosed by partnerships.
- Determine book value following a reevaluation of LLC or partnership assets.
- Determine strategies to avoid making mistakes on partnership tax returns.
Major Topics:
Common errors made involving the following tax forms:
- Form 1065
- Schedules K and K-1
- Schedules M-1 and M-2
- Form 4562
- Form 4797
