Surgent's Partnership and LLC Core Tax Issues From Formation Through Liquidation

Overview

As they gain more experience, staff are expected to take on more complex assignments with minimal supervision. The course is designed to be a stepping stone for staff interested in pursuing more advanced partnership and LLC issues than mere preparation, via deeper life-cycle study into critical areas of formation, special allocations of income and deductions, basis calculations and implications of recourse and nonrecourse debt, basis step-up under 754 on transfer of an ownership interest, distributions, self-employment tax issues, and termination/liquidation of the LLC. With the right blend of legal and tax ramifications of LLC-specific issues, this course identifies all the major areas that are potential sources of increased complexity.

Prerequisites

Knowledge and experience in business taxation

Objectives

• Prepare more complicated partnership returns
• Understand certain advanced concepts of partnership taxation

Highlights

• Reporting requirements for Schedules K-2 and K-3
• Capital account reporting requirements
• Schedule K-1 reporting for §743 adjustments
• Schedule K-1 reporting for §704 gains and losses
• Comprehensive case on partnership/partner application of the business interest deduction
• When to use “704(b) basis” for capital accounts versus “tax basis”
• Detailed rules of §704 for preventing the shifting of tax consequences among partners or members
• Unreasonable uses of the traditional & curative allocation methods
• Multiple layers of §704(c) allocations
• Treatment of recourse versus nonrecourse debt basis
• How to calculate basis limitations and its implication on each partner’s own tax return
• How §179 limitations affect partnership/LLC basis
• Regulations for handling basis step-ups under §754 elections, and mandatory adjustments under §743 and §734 for partnerships who have NOT made the §754 election
• Subsequent contributions of property with §754 adjusted basis to another partnership or corporation
• Capital account adjustments in connection with admission of new member
• Special allocations require "substantial economic effect"; what are the requirements?
• LLCs and self-employment tax to the members
• Distributions -- current or liquidating, cash or property including the substituted basis rule
• Termination/liquidation of an LLC
  

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