What’s new for 2022 in federal taxes
A law change and some regulations take effect while an array of provisions expire.
Partnership & LLC Taxation
How LLCs may obtain tax-exempt recognition
Notice does not affect the status of already recognized organizations.
Further guidance issued on tax treatment of PPP loan forgiveness
Forgiveness amounts are excluded from gross income but included in gross receipts for purposes including determining “small business taxpayer” status under Sec. 448(c).
Carried interest reporting FAQs and guidance posted
The IRS posted FAQs with sample worksheets and instructions for taxpayers to use when calculating and reporting certain net long-term capital gains from partnership interests held in connection with the performance of services that must be recharacterized as short-term capital gains.
Guidance issued for LLCs seeking tax-exempt recognition
The IRS clarified the standards that an LLC must satisfy to obtain a determination letter that it is exempt from taxation under Sec. 501(c)(3).
Partner capital account reporting gets transition penalty relief
Errors by partnerships in reporting partners’ tax capital accounts under new rules for 2020 may be excused, the Internal Revenue Service outlined.
Carried interests regulations are finalized
The IRS finalized proposed regulations on certain carried interests to account for changes made by the Tax Cuts and Jobs Act (TCJA). The TCJA extended from one year to three years the holding period for making carried interests eligible for capital gain treatment.
Final regs. issued on foreign partnership interests
Rules govern withholding on transfers and ECI.
Business tax quick guide — tax year 2020
Download or print this quick guide for use during tax season, and look for our quick guide for individual taxpayers in the January 2021 issue.
Centralized partnership audit regime changes proposed
The IRS issued rules on two special enforcement matters for purposes of the unified partnership audit rules.
Partnerships and S corps. can deduct state and local taxes
The IRS said it would issue proposed regulations allowing S corporations and partnerships to deduct “specified income tax payments” paid to state and local governments above the line and not as passthrough items for partners and shareholders.
Draft instructions for partnership capital account reporting released
The IRS released draft instructions for Form 1065, U.S. Return of Partnership Income, to calculate partner capital accounts using the tax-basis method.
Rules govern withholding on transfers of partnership interests and ECI
The IRS finalized proposed regulations on withholding from transfers of partnership interests to foreign persons and the definition of effectively connected income for those purposes.
Settlement agreement’s capital gain allocation withstands challenge by IRS
The Tax Court finds a payment was for repudiated joint venture interests, not future income.
Proposed rules govern carried interests
The Irs issued proposed regulations under Sec. 1061, enacted by the law known as the Tax Cuts and Jobs Act, which requires owners of certain partnership interests to hold them for three years to be eligible for capital gain treatment.
Partnership form being redesigned for 2021
The IRS proposes modifying the partnership form (Form 1065) to help standardize the format of international tax items.
Partnerships can file amended returns to get CARES Act benefits
To allow those partnerships to take advantage of the beneficial tax provisions in the Coronavirus Aid, Relief, and Economic Security Act, the IRS is allowing partnerships to file amended returns for 2018 or 2019.
Getting states on board: A model for partnership tax audits
The rules have changed for IRS examinations and adjustments of partnership returns at the federal level, but are the states following suit? We’ll find out how model legislation issued by the Multistate Tax Commission, developed in collaboration with the AICPA and other stakeholders, is being adopted across the U.S.
Why states need to enact MTC model statute in 2020
Campaign seeks to create a uniform state-by-state regime that aligns with changes to federal partnership audits.
$8.7 million partnership income adjustment by IRS disallowed
Family mobile home business's promissory notes were not includible in income, the Tax Court holds.
