Correcting Capital Account Mistakes and Errors on Partnership Returns

A Comprehensive Guide to Corrections, Allocations and "True-Ups" of Capital Accounts

Recording of a 110-minute CPE webinar with Q&A


Conducted on Tuesday, April 25, 2017

Recorded event now available

or call 1-800-926-7926
Program Materials

This webinar will provide tax professionals and advisers with a deep and highly practical guide to the accounting and tax disclosure requirements necessary to correct and adjust capital account balances. The panel will focus on the mechanics of both book entries and tax reporting, and will offer concrete examples of corrective entries and form reporting as illustrations. The webinar will also cover interpretation of partnership agreements and offer guidance on how to apply partnership provisions to corrective entries and tax disclosures.

Description

Maintenance of capital accounts is one of the more challenging tasks for tax professionals advising partnerships. Due to inexperience, changes in advisers, and/or errors and omissions, capital accounts are often not maintained accurately. Unless corrections and adjustments are made, such items can lead to misallocation, phantom income and basis errors.

Even more frustrating is that in many cases the corrective adjustments to bring the accounts back into balance are not always clear. Moreover, these issues will become even more challenging with the advent of the new partnership audit rules.

Partnership accounting is by its very nature complicated, and there are a number of transactions and events that cause difficulties in maintaining capital accounts. Provisions such as allocations of nonrecourse liabilities, minimum gain chargebacks, and multistate filings are areas that can create problems for tax professionals. Advisers must be able to identify and correct capital account discrepancies from both compliance and reporting standpoints.

Listen as our experienced panel provides an overview of common—and not so common—capital account errors and scenarios that need corrective measures, and will outline the book and tax reporting adjustments to remedy the situations.

READ MORE

Outline

  1. Partnership agreement interpretation
  2. Identifying capital account misstatements
  3. Book entries
  4. Tax reporting and disclosures
  5. Interaction with new partnership audit rules
  6. Case study with illustrations

Benefits

The panel will discuss these and other critical issues:

  • How to identify errors, miscalculations or misstatements in capital accounts
  • Corrections in instances of incorrect mandatory adjustments
  • Basis and capital account corrections where a valid Section 754 election was in place
  • Book vs. tax corrective adjustments
  • Prior year adjustments
  • Effect of new partnership audit rules

Faculty

Johnson, Steve
Steve R. Johnson

Professor
Florida State University

Mr. Johnson is a nationally recognized scholar on tax litigation and procedure, including legislative and...  |  Read More

Mandarino, Joseph
Joseph C. Mandarino

Partner
Smith Gambrell & Russell

Mr. Mandarino's practice focuses on corporate, tax and finance law. He is involved with a wide variety of...  |  Read More

Other Formats
— Anytime, Anywhere

CPE On-Demand

See NASBA details.

$182

Download

$147