The number of partnerships is steadily growing, in large part because these entities offer great flexibility in allocating income and loss. The IRS has taken notice of this growth, with Commissioner Doug Shulman testifying before a Senate Subcommittee that one way the IRS will improve compliance is to shift enforcement resources to partnerships and other flow-through entities.
Hot topics included in the 2012 edition include:
- New Form 1065X. The IRS issued a new Form 1065X, Amended Return or Administrative Adjustment Request Form in 2012. The form is for use when partnerships file paper copies of amended returns or administrative adjustment requests. This edition of the Deskbook includes discussion on this new form and a sample filed in form.
- Circular 230 Requirements. Practitioners need to be especially vigilant in representing taxpayers and preparing tax returns. With strengthened return preparer penalties and an emphasis on due diligence in preparing returns and representing taxpayers before the IRS, the consequences of a misstep are greater than before, including the potential loss of the right to prepare federal tax returns. Additional discussion and practice aids have been added to ensure practitioners are in compliance with Circular 230 requirements.
- New Tangible Property Temporary Regulations. In December 2011, the IRS released long-awaited temporary regulation on the deduction and capitalization of amounts paid to repair, maintain, or improve tangible property. Coverage of these new regulations can be found in several chapters as they will affect accounting method changes, the reporting of repair and maintenance expenses, and depreciation of tangible property just to name a few.
- Definition of Limited Partner. Proposed regulations were issued in November 2011 that provide a new definition of a limited partner interest for passive activity purposes. A discussion of these regulations is included in this edition of the Deskbook.
- New Practice Aids. Several new elections, tables and practice aids were added to this year’s edition of the Deskbook. For example, a new table comparing the calculations for partner outside basis, at-risk basis and tax basis capital accounts has been added. In addition several new practice aids have been included to aid in meeting the practitioner’s due diligence in tax compliance.
Our subscribers tell us that the number one partnership compliance issue they face is properly preparing Schedule K-1. So, we updated this year’s edition for the 2012 lines and codes for reporting various types of pass-through items to the partners. Furthermore, this year’s edition provides dozens of filled-in Schedule K-1s to help you prepare accurate Schedule K-1s, and to help your clients avoid matching problems with the IRS. The Deskbook includes valuable tax practice tools too, including long and short form return preparation checklists; long and short form client organizers; initial and final year return preparation checklists; and a return preparation engagement letter. Furthermore, the unique tax planning roadmaps are designed to give you and your staff a quick and easy way of identifying tax-saving opportunities for existing or potential clients by reviewing their completed tax return.
Integration with UltraTax CS Form Software. Subscribers of UltraTax CS Form 1065 software and PPC’s 1065 Deskbook on Checkpoint can go directly from any tab section on any input screen to the relevant key issues, practice aids and illustrations in the Deskbook – with the click of a button! Take advantage of the integration between UltraTax CS, other practice management and engagement software from Creative Solutions, and PPC’s 1065 Deskbook on Checkpoint to confidently resolve complex tax issues, and easily and efficiently verify the accuracy of information on a return.
For information on UltraTax CS software or to view a demo of the integration with PPC’s 1065 Deskbook, visit http://cs.thomson.com/tax/quicklook.aspx. Call 800-431-9025, option 1, for more information.
PPC's Tax Practice Aids™. PPC delivers the solution you've been asking for! PPC'sTax Practice Aids™ are Microsoft® Word and Excel versions of all of the editable practice aids in the 1065 Deskbook. Experience improved productivity and convenience right away, since your staff already uses Word and Excel. PPC's Tax Practice Aids™ include value added productivity features such as math capabilities with built in formulas, quick fill-in features for engagement letters and election statements, and one-click signoffs for programs and checklists.
Now in its 23rd year and written and reviewed by experienced practitioners, PPC’s 1065 Deskbook explains the partnership reporting rules in plain English to ensure the consistent, accurate, and efficient preparation of your client’s tax returns. Don’t trust your busy season to anyone else!