Course

Partnership Preparation, Basis Calculations & Distributions: Form 1065 Schedule K & K-1 Analysis

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Event Details

Wednesday, October 23, 2019

8:00am – 4:00pm
(Registration: 7:30am)

Location

Hilton Garden Inn

2023 Commerce Way

Bozeman, MT 59715

406-582-9900

Field of Study

Taxes

CPE Credit

8 hours CPE credit

Course Code

PBAD-32

Instructor

Level of Knowledge

Intermediate

Vendor

Phoenix Beach LLC

Prerequisites

None

Description

This comprehensive training is designed to get the accountant up to speed quickly with partnership and limited liability company (LLC) formation and preparation issues as well as a complete understanding of calculating a partner and LLC member’s basis. The cornerstone of this course is the in-depth line-by-line analysis of the Form 1065 Schedule K and K-1 and how these items affect the partner/member’s individual income tax return.

Highlights

Each attendee will receive the most comprehensive reference manual with numerous practice aids and real-world examples and case studies. Topics include but are not limited to:

  • Extensive review of the partnership tax laws with an emphasis on any new legislative changes including the Tax Cuts & Jobs Act (TCJA) new 20% qualified business income (QBI) deduction and changes to the interest deduction, fringe benefits and entertainment expenses
  • Review the Form 1065 to learn how income statement items get reported on the partnership/LLC tax return (i.e. page 1 versus Schedule K) and flow-thru to the partner/members on Schedule K-1
  • Analyze the Schedule K-1 line-by-line and discuss where the items get reported on the individual’s Federal income tax return and how the items affect the partner/member’s outside basis
  • Look at what relevant information related to the 3.8% net investment income tax needs to be reported to the partners/members
  • Formation issues including the mandatory allocation of the §704(c) pre-contribution gain or losses back to the contributing partner/member
  • The purpose of tax and §704(b) book capital account
  • Reporting recourse and non-recourse debt on the Schedule K-1
  • Tax ramifications and reporting of cash and non-cash distributions including disproportionate distributions of “hot assets”
  • Overview of the §754 election for optional basis adjustments triggering §743 (transfer of interests) and §734 (distributions)

Objectives

Once participants have completed this session they should be able to:

  • Form a partnership and calculate the partnership’s initial inside basis in the assets and partner’s outside basis in the entity.
  • Prepare a basic partnership (Form 1065) Schedule K including the reporting of cash and non-cash distributions.
  • Understand how the schedule K items get allocated to the partners/members on their individual Schedule K-1.
  • List the three main reasons for calculating a partner/member’s basis in a partnership/LLC.
  • Calculate a partner/member’s outside basis and determine if losses and deductions are limited on their individual income tax return.

Designed For

Tax professionals that need an in-depth training course on tax preparation issues, basis calculations and distributions rules for partnerships, LLCs and their owners.

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