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Tracking Partnership & S Corporation Basis

Duration: 100 minutes 
Course Level: Basic
Prerequisite: None
Advanced Preparation: None
Delivery Method: Self-Study 
 
CPE Credits Designation Field of Study
IRS * 2 EA Federal Tax Law Topic
NASBA 0 CPA N/A
CTEC 2 CRTP Federal Tax Law Topic
CFP Board 2 CFP® Income Tax Planning

* NATP will report CPE credits to the IRS for all PTIN holders. CPE is currently not mandatory for RTRPs or RTRP candidates and any option to register or participate in this program is strictly voluntary.

Fees: $49 for Members and $60 for Nonmembers
 
Summary
Flow thru entities such as partnerships and S corporations are great ways to enjoy the benefits of having a business entity yet not experience double taxation like C corporations. However, in some ways, the rules regarding the treatment of items of income and expense are more complicated in flow thru entities. This is largely due to partner or shareholder basis. Regardless of whether your client is in a partnership or S corporation, you must track basis for him or her. It’s important because it determines the amount of loss he can deduct and also it will determine how much gain or loss he recognizes on the final disposition of the ownership interest. To confuse things further, you have to factor in at-risk basis, debt basis and passive loss limitations. We will teach you how to track basis annually in a flow thru entity and determine the effect of distributions. If you have clients who own partnership interests or S corporation stock, you can’t miss this webinar!

Objectives
Upon completion of this webinar, you will be able to:

  • Determine a taxpayer’s following loss limitations: stock, at-risk and passive
  • Distinguish between debt basis for a partner and an S corporation shareholder
  • Identify the ordering rules for distributions
  • Document basis for regular and alternative minimum tax (AMT) purposes
  • Elect that, for an S corporation, distributions come out of earnings and profits first

Presenter: Steven (Steve) O'Rourke, EA

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