Mastering Reporting of Publicly Traded Partnership and MLP K-1s on Partners' Returns

Navigating Footnotes and Tying Information to the 1040

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


Conducted on Tuesday, December 22, 2020

Recorded event now available

or call 1-800-926-7926
Program Materials

This webinar will provide tax advisers and professionals with tools and practical knowledge to reconcile complex Schedule K-1s for publicly traded partnerships (PTPs) and master limited partnerships (MLPs), using sample K-1 information from complex oil and gas partnership footnotes and disclosures as an example. The panel will offer guidance on how to translate reportable information onto the partner's Form 1040, prepare basis schedules, and report at-risk and passive loss limitations.

Description

For most K-1s received by taxpayers, reporting the pass-through items of income and loss is relatively straightforward. However, for many oil and gas PTPs and MLPs, the K-1 often requires the tax preparer to compile complex reconciliation schedules before transferring the information reported onto the partner's income tax return.

A Schedule K-1 from an oil and gas partnership can easily exceed 50 pages or more. These K-1s have important tax reporting information in the extensive footnotes following the standard page 1 boxes listing income, deductions, credits, and distributions. To allocate and report items on the client's tax return, tax professionals must use information from the footnotes.

Schedule K-1s from PTPs and MLPs also present challenges to tax preparers in reporting the client's basis and at-risk amounts in the investment. Tax professionals must review the K-1 and footnotes to prepare and maintain accurate basis schedules, at-risk amount calculations, and capital accounts.

Listen as our experienced panel provides detailed and practical guidance to help tax professionals correctly reconcile tax information from these complex K-1 schedules and accurately report the information onto the tax return.

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Outline

  1. The law and regulations, including recent developments
  2. Review of Schedule K-1 data, including crucial footnote information
  3. Required combinations and allocations
  4. Gain/loss reporting for assets sold by the partnership
  5. How to tie reconciliation schedules to Schedule K-1 to tax return
  6. Basis schedule, capital accounts, and at-risk amounts
  7. Oil and gas items

Benefits

The panel will review these and other critical topics:

  • The law and current regulations
  • Understanding K-1 footnotes to determine items such as passive vs. non-passive income, as well as dispositions
  • Knowing when a K-1 requires the tax preparer to enter info in return areas other than Sch. E pg. 2
  • Reporting the information found in reconciliation schedules onto the partner's income tax return
  • Calculating basis on capital assets sold within a partnership to correctly report gain or loss on Form 8949
  • Preparing and maintaining a basis schedule for the partnership investment
  • Recent developments, including the proposed regulations regarding the definition of "qualifying income" for PTPs in the oil and gas industry

Faculty

Clayman, Jeffrey
Jeffrey Clayman, CPA, JD, LLM

Tax Senior Manager
Withum Smith+Brown

Mr. Clayman has over 18 years of public accounting experience with a focus on for-profit businesses in many different...  |  Read More

Lovett, Brian
Brian T. Lovett, CPA, JD

Partner
Withum Smith+Brown

Mr. Lovett has extensive experience serving the tax needs of both public companies and closely-held businesses,...  |  Read More

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