Level II: Corporations and Partnership

You must complete Level I to take this course as it contains previous examples.

This level II self-study course continues with:

  • The taqueria is in the second year of business and has a loss. What do you do with a loss on the tax return
  • Find out how and where to report reimbursements for an accountable plan, paid medical insurance for shareholders, dividends paid from retained earnings for shareholders for the C-Corp and partnership expense for the S-Corp and Partnership.
  • Other topics covered will be Net Operating Loss (NOL) carryback, effect in basis for S-Corp and Partnership non-deductible expenses and donations.



Day 1: C-Corporations

Level two will advance C corporations issues and treatment. We will cover issues on paying income tax liability and estimated payments. We will also take a closer look into different issues affecting Net Operating Losses. Schedules C, J, K, L, M-1 and M-2 will be covered line by line.

Day 2: Partnerships

This day will focus on complex and mixed partnerships, we will discuss the implications of selling partnership assets both for gains and losses; we will see in detail Guaranteed Payments for both Service and Capital. We will review all forms referred to on form 1065, including the new forms K2 and K3. We will also prepare a tax return based on the sample financial statements using Drake Software for a partnership and one partner’s personal return to demonstrate the use of UPE.

Day 3:  S-Corporations

We will take our level I example and introduce more complex issues surrounding S corporations shareholders, their reasonable salary and K1 income, and how distributions as taxed. We will determine the ordering rules for basis adjustments, compute the shareholder’s stock basis, and recognize the difference between taxable and nontaxable fringe benefits for S corporations.

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