Don Farmer's Top 10 Partnership Return Issues and How to Avoid Them

Overview

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Partnership taxation remains one of the most complex and high-risk areas of federal tax compliance. From basis calculations and allocation rules to disguised sales, debt allocations, and partnership audit exposure, even experienced CPAs can encounter technical pitfalls that create significant financial and professional risk.
This two-hour program examines the top 10 partnership tax issues most frequently encountered in practice. Designed specifically for CPAs advising partnerships and partners, the course provides practical guidance to identify, analyze, and avoid common compliance errors under Subchapter K. Through real-world examples and application of current tax law, participants will strengthen their technical proficiency and improve the quality of client advisory services.

Delivery Method: Group internet-based
CPE Credit: Taxes
Program Level: Intermediate

Virginia Society of CPAs is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State Boards of Accountancy have the final authority on the acceptance of individual course for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org

Highlights

Overview of Subchapter K and common partnership risk areas
Partner capital accounts: tax basis vs. §704(b) capital vs. book basis
Outside basis vs. inside basis calculations
Allocation rules and substantial economic effect under §704(b)
Partnership liabilities and debt allocation under §752
Disguised sales and related-party transactions under §707
Partnership distributions (current and liquidating) and gain recognition rules
Sale or exchange of partnership interests and §751 hot assets
§754 elections and basis adjustments
Overview of the centralized partnership audit regime (BBA)
Best practices for documentation and compliance risk mitigation

Prerequisites

Designed For

Objectives

Upon completion of this program, participants will be able to:

Identify common technical errors in partnership taxation and explain their compliance implications.
Differentiate between outside basis, inside basis, and §704(b) capital accounts.
Analyze the tax impact of partnership liabilities under §752.
Determine when a transaction may be treated as a disguised sale under §707.
Apply rules governing partnership distributions and recognize when gain must be reported.
Evaluate the tax consequences of selling a partnership interest, including §751 hot asset treatment.
Explain the purpose and impact of a §754 election.
Recognize audit and compliance risk areas under current partnership tax rules.