Description
Eliminate errors and gain a better understanding of the K1.Many people know that a K1 is used to report items of income, deductions, and loss to partners but don’t know all of the details that exist in a K1. Many may not be on top of the subtle changes being made to the K1 over the years and the latest effort to add a K2 and K3 to the information return filings. Often, partners or members who receive a K1 do not know how to examine the K1 for errors. And those partners or members who discover their K1 is wrong often do not know what to do next. While simply filing a notice of inconsistent treatment (IRS Form 8082) may seem like an easy thing to do, just the opposite is true. Careful regard must be given to the fact that a dispute has occurred and where state and federal laws must be considered. An overall strategy is needed. This topic will help practitioners understand issues that need to be addressed when dealing with a client who comes to them with a K1 they believe is in error or when they have not received a K1. For those partners or members who receive a K1 that they know is wrong, they must take action, and those advising them must know whether new audit rules apply (i.e., under the new audit procedures in place as a result of the 2015 Bipartisan Budget Act (BBA). Doing nothing is not an option. You will be provided the ability to analyze a K1, and if it is found to be in error, then decide on an appropriate course of action in consultation with your advisors. To do so, you will want to consider recent changes in the tax law and anticipate changes to the K1. The latest developments will also be discussed, including the anticipated use of new schedules K2 and K3.