2024 K-1 law change for part L?

Forum|Forum|1 year ago
November 27, 2024
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This is a little bit off topic, but this seems like a good source to start with. I'm trying to get a head start on 2024, so have been trying to see if there were any law changes for K-1s and found this. Has anyone else seen it?

RS doesn't require LLC to complete information related to the partners' capital accounts or balance sheet for business if:

the business has less than $250,000 in income for the year
the business has less than $1 million in total assets for the year
the business will deliver Schedule K-1's on time to partners.

has anyone seen this or heard of it?

Not A Product Question

Best answer by Anonymous_

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Anonymous_Answer

Employee

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RedheatherAuthor

Employee

thank you so much! it's so obvious...guess I'd better put on my tax brain pretty quick

thank you so much!!!!!!!!!!!

Redheather

Mike9241

however, if schedule L on the K-1s is not completed the partners will still need to keep track of their tax basis.

losses in excess of tax basis are not deductible. distributions in excess of basic are taxable. should a partner inherit an interest the tax basis of the deceased partner is important if there will be a section 751/754 step-up. Also, should a partner dispose of their interest they'll need to know their basis to determine gain or loss.

there are worksheets available on the web for this purpose

I would point out that for S-Corps , starting a few years ago the IRS required form 7203 to be included under some circumstances. Many owners never kept track and have asked for help so they could properly complete the form. In some cases, this required them to go back to the first year of the corp for which they no longer maintained records. in the future, the IRS could require a similar form for partnerships.