Tax Fundamentals of LLCs and Partnerships - Tax Staff Essentials

Building a solid foundation of partnership and LLC taxation

A foundational understanding of partnership taxation is essential to a tax preparer's career. Given that most U.S. businesses are formed as pass-through entities, you'll likely encounter partnership tax matters that require your attention.

This course covers the taxation of partnerships, including limited liability companies (LLCs) treated as partnerships for U.S. federal income tax purposes.

Matters discussed include:

• Common transactions
• Check-the-box election rules
• Consequential court cases involving partnership formation

Skills to explain partnership taxation matters to your clients

Talking about tax can sometimes sound like speaking a foreign language to your clients. Learn how to explain complex issues with accuracy and confidence.

Key Topics

• Basic tax structure of partnerships and LLCs
• Check-the-box elections to be taxed as a partnership
• Partnership distributions
• Compensatory payments to partners
• At-risk and passive activity limits
• Profit and loss allocations: general rules and restrictions

Learning Outcomes

• Identify the effects of investor contributions and distributions on their basis in a partnership or LLC interest.
• Identify the tax basis of assets transferred to a partnership or limited liability company (LLC) at formation.
• Recognize the tax consequences of a transfer of liabilities to a partnership or LLC in connection with property transfers at formation.
• Indicate the correct treatment of partnership income by a partner for self-employment tax purposes.
• Distinguish between current and liquidating distributions.
• Recall whether special allocations called for in a partnership agreement will be allowable under the Section 704(b) regulations and when they will not be recognized by the IRS.

Who Will Benefit

• Public accounting staff and seniors
• Tax professionals in company finance or tax departments