With tax laws growing more complex and evolving by the minute, CPAs need more than just a surface-level understanding of partnership and LLC taxation. This course takes a lifecycle approach’from formation through growth and operations to eventual liquidation’focusing specifically on closely held entities. Through case-driven instruction, you’ll tackle real-world tax issues at both the partnership and partner level. We’ll break down key concepts with practical examples and scenarios you’re likely to encounter in the field. Attendees will leave with a comprehensive reference manual packed with practice aids, actionable guidance, and fully developed case studies you can put to work immediately.
Learning Objectives
• Form a partnership/LLC and calculate the entity’s initial inside basis in the assets and partner/member’s outside basis in the entity
• Understand the operational issues during the growth and maturity of a partnership/LLC and how the schedule K items get allocated to the partners/members on their individual Schedule K-1 effecting outside basis
• Comprehend the tax ramifications
Major Topics
- • Extensive review of the partnership tax laws with an emphasis on any new legislative changes including any TCJA provisions expiring after 2025
• Overview of different forms of business entities including the check-the-box regulations
• Formation issues including the mandatory allocation of the §704(c) pre-contribution gain or losses back to the contributing partner/member
• Schedule K and K-1
• separately stated versus non-separately stated income and expense items
• Detailed Schedule K-1 reporting including the 20% qualified business income (QBI) deduction and 3.8% net investment income tax
• Calculating the tax and §704(b) book capital accounts
• Substantial economic effect requirement to have special allocations to the partners/members
• Allocation of recourse & non-recourse debt on K-1s
• Guaranteed payment issues and tax treatment of fringe benefits
• Self-employment tax issues and pitfalls
• Tax treatment of distributions - cash versus non-cash & liquidating versus non-liquidating
• Sales and liquidations (redemptions) of partnership interests
• §754 optional basis adjustments and mandatory adjustments
