- NY Credits : 2.0
- TX Credits : 2.0
- IRS Enrolled Agent Credits : Federal Tax/Tax Related Matters - 2.0
Most practitioners deal with Form 1065, U.S. Return of Partnership Income, on a regular basis. This program takes a look at the analysis of partners' capital accounts, including Item L on Schedule K-1, Schedule M-2, book versus tax capital accounts, partner allocations, how to account for changes in a partner's interest in the partnership, partner and partnership reporting requirements, consolidated audit proceedings, the at-risk and passive activity rules, the IRC Sec. 179 deduction, the rules under IRC Sec. 707(a) and (b) that limit the losses between related partner and nonpartner transactions, partnership allocations, the various partnership allocation tests that must be met in order for a partnership allocation to be respected, gain/loss and income chargebacks, minimum gain chargeback, and the safe harbor rules for allocation of nonrecourse deductions.
Upon successful completion of this course, the user should be able to:
identify various methods of maintaining partner capital accounts,
determine book and tax capital accounts,
recognize differences between book and tax capital accounts,
recognize capital accounts maintained under Regulation Sec. 1.704-1(b)(2),
recognize how partnership flow-through concepts are affected by specific deduction limitations and specific classes of taxpayers,
determine whether allocations have substantial economic effect,
identify partnership allocation,
determine the relationship of the allocation of nonrecourse deductions and minimum gain,
recognize the purpose of Schedule M-2 in maintaining capital account balances, and
recognize the definition of "material participation."