For the 2021 tax year, the IRS has introduced new Schedules K-2 and K-3 to partnership and S corporation tax returns to standardize the reporting of foreign-related tax information. However, the reporting might apply to domestic entities that have no foreign activities. At 20 pages in length, these schedules provide significant compliance burdens to the taxpayers and require tax preparers to understand the basics of U.S. taxation of foreign income and foreign persons. This course will discuss filing requirements including the first-year filing relief as well as basic rules regarding international taxation in order to understand what information is required to be reported in different parts of the schedules. The course includes examples on how the form should be completed.

Topics & Learning Objectives Include:

• Filing requirements for Schedules K-2 and K-3, including the first-year filing relief
• Basic introduction to income sourcing rules and apportionment of deductions for foreign tax credit
• How to complete Parts II and III for foreign tax credit, including examples
• Basic information needed in Parts IV and IX for corporate partners
• Logic behind Part X for foreign partners