To provide CPAs, tax accountants, and finance professionals with a comprehensive understanding of basic and complex partnership taxation issues. You'll be equipped to identify problems and opportunities in transactions involving partnership formation, transactions with partners, basis, partnership distributions, allocations and other key areas.
DETAILED LEARNING OBJECTIVES
• Identify the default federal tax classification of a domestic eligible entity with two or more members under the Check-the-Box Regulations
• Recognize the potential for double taxation when a business operates as a C corporation
• Identify unlimited liability as a potential disadvantage of operating as a general partnership
• Determine how a partner’s share of partnership liabilities affects the partner’s outside basis
• Identify the substantial economic effect requirement applicable to special allocations under Section 704
• Recognize the potential corporate-level and shareholder-level tax consequences of a corporate asset sale followed by a distribution of proceeds
• Identify how partnership acquisition structures may defer gain attributable to an illiquid equity interest received by a seller
• Recognize the effect of the OBBBA Act of 2025 on the Section 199A qualified business income deduction
• Distinguish partnership-level tax determinations from limitations applied at the individual partner level
• Evaluate whether a special allocation satisfies the substantial economic effect standard under Section 704
• Identify the tax consequences determined by a partner’s outside basis
• Calculate a partner’s initial outside basis from contributed cash, the adjusted basis of contributed property and the partner’s share of partnership liabilities
• Determine a partnership’s initial inside basis in property contributed by a partner
• Identify the filing deadline for an eligible unincorporated organization to elect out of Subchapter K
• Identify the form used by an eligible entity to elect C corporation classification under the Check-the-Box Regulations
• Identify the form used by an eligible entity to elect S corporation status
• Recognize how an election out of Subchapter K may preserve like-kind exchange treatment for qualifying real property co-owners
• Identify the time limit and principal requirements for obtaining relief for a late Form 8832 entity-classification election
• Recognize when the IRS may permit an entity to change its classification before expiration of the 60-month limitation
• Determine how a disregarded single-member LLC reports its operations when its sole owner is a corporation
• Determine a partnership’s required taxable year under the majority-interest taxable-year rule
• Identify the ownership threshold used to classify a partner as a principal partner for taxable-year purposes
• Apply the principal-partner rule when determining a partnership’s required taxable year
• Determine the required taxable year under the least-aggregate-deferral rule
• Identify when a partnership may use an alternative taxable year based on a business purpose or a Section 444 election
• Recognize that a partnership generally selects its accounting method at the entity level
• Identify the 2026 average annual gross receipts threshold relevant to the small-business exception for use of the cash method
• Determine when allocations of partnership losses may cause a partnership to be treated as a tax shelter required to use the accrual method
• Identify the consistency and clear-reflection-of-income requirements applicable to a hybrid accounting method
• Distinguish the partnership-level international tax information reported on Schedule K-2 from the partner-level information reported on Schedule K-3
• Distinguish elections made by a partnership from elections made separately by individual partners
• Identify the federal tax treatment and reporting of guaranteed payments made by a partnership to a partner for services
• Calculate a general partner’s net earnings from self-employment when allocated business income is not fully distributed
• Determine when a partner’s distributive share of rental income may be included in net earnings from self-employment
• Distinguish the Social Security and Medicare components of self-employment tax and their respective wage-base limitations
• Evaluate whether an LLC member’s active management and substantial services cause the member’s distributive share to be subject to self-employment tax
• Identify the factors used in Soroban Capital Partners to determine whether limited partners were limited partners in name only for self-employment tax purposes
• Calculate self-employment income when an LLC member holds separate active-management and investor-class interests
• Distinguish the partnership-level Section 179 election from the limitations applied at both the partnership and partner levels
• Calculate the maximum Section 179 deduction after applying the statutory phaseout threshold
• Determine whether acquired property satisfies the Section 179 requirements for qualifying property and business use
• Explain why a partner’s allocable share of Section 179 expense must be separately stated on Schedule K-1
• Determine the Schedule K-1 reporting treatment of partner health insurance premiums that are not paid as compensation for services
• Identify when ownership by a reportable entity partner independently requires a partnership to file Schedule M-3
• Apply the Section 721(a) nonrecognition rule to a contribution of appreciated property in exchange for a partnership interest
• Determine whether a contribution to an investment company results in diversification for purposes of the Section 721(b) exception
• Calculate recognized gain when appreciated securities are contributed to a partnership treated as an investment company
• Identify circumstances that prevent a profits interest from qualifying for the safe harbor under Revenue Procedures 93-27 and 2001-43
• Identify the partner-status and Schedule K-1 reporting requirements applicable to a service provider who receives a qualifying profits interest
• Evaluate whether a management fee waiver exchanged for a profits interest may constitute a disguised payment for services
