FL - Guidance issued on catastrophic event property damage
Florida provides guidance on catastrophic event property damage for property tax purposes. Topics discussed include the payment of property taxes, […]
Read MoreThe IRS has provided further details on additional transition relief for certain domestic partnerships and S corporations preparing the new schedules K-2 and K-3 to further ease the transition to these new schedules. Those eligible for the relief will not have to file the new schedules for tax year 2021. The new schedules K-2 and K-3 improve reporting by standardizing international tax information to partners and flow-through investors, making it easier for them to report these items on their tax returns. The changes ease flow-through return preparation compliance by clarifying obligations and standardizing the format for reporting. Notice 2021-39 provides penalty relief for good-faith efforts to adopt new schemes. This transition relief, appearing in the new frequently asked questions (FAQs) on Schedules K-2 and K-3, allows an additional exception for the tax year 2021 filing requirements by certain domestic partnerships and S corporations.
The following conditions must be met to qualify for this exception:
In tax year 2021, the direct partners in the domestic partnership are not foreign partnerships, foreign corporations, foreign individuals, foreign estates, or foreign trusts.
In tax year 2021, the domestic partnership or S corporation had no foreign activity, including foreign taxes paid or accrued or ownership of assets that generate, have generated, or may reasonably be expected to generate foreign source income.
In tax year 2020, the domestic partnership or S corporation did not provide to its partners or shareholders nor did the partners or shareholders request the information regarding (on the form or attachments thereto): (1) Line 16, Form 1065, Schedules K and K-1 (line 14 for Form 1120-S), and (2) Line 20c, Form 1065, Schedules K and K-1 (Controlled Foreign Corporations, Passive Foreign Investment Companies, 1120-F, Code Sec. 250, Code Sec. 864(c)(8), Code Sec. 721(c) partnerships, and Code Sec. 7874) (line 17d for Form 1120-S).
The domestic partnership or S corporation has no knowledge that the partners or shareholders are requesting such information for tax year 2021.
If a partnership or S corporation qualifies for this exception, the domestic partnership or S corporation need not file Schedules K-2 and K-3 with the IRS or with its partners or shareholders. However, if the partnership or S corporation is subsequently notified by a partner or shareholder that all or part of the information contained on Schedule K-3 is needed to complete its tax return, then the partnership or S corporation must provide the information to the partner or shareholder. If a partner or shareholder notifies the partnership or S corporation before the partnership or S corporation files its return, the conditions for the exception are not met and the partnership or S corporation must provide the Schedule K-3 to the partner or shareholder and file the Schedules K-2 and K-3 with the IRS.
Florida provides guidance on catastrophic event property damage for property tax purposes. Topics discussed include the payment of property taxes, […]
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