Form 8865 Reporting of Foreign Partnership Income and Navigating Rules for Allocable Share of Foreign Income

Filing Form 8865 requires presentation of data that ranges from simple to highly complex on the return and its associated Schedules A, B, C, K, L and N. Correctly completing the form involves hours of intensive work, from proper recordkeeping to compiling data and correctly following IRS regs and instructions.

The IRS’ emphasis on international tax compliance makes accurate compliance with this return a much greater priority. Though in past years the IRS imposed penalties for late or non-filing selectively, the Service started automatically imposing hefty penalties on late and non-filers in the past few years.

Our panel of experienced tax advisers will explain the nuances, audit red flags and common pitfalls involved in completing Form 8865 and its schedules. They will offer lessons from the field to arm you with the knowledge and tools to efficiently confront and overcome the reporting and compliance challenges.

Listen as our panel identifies and explains the most difficult aspects of preparing Form 8865 for reporting foreign partnership income. The panel will outline approaches for you to properly identify taxpayer category, determine allocable share of foreign income, and stay ahead of potential audit red flags and common errors.

1. Purpose of Form 8865
2. IRS enforcement and audit environment to date
3. Preparation of Form 8865
4. Schedules
5. Difficult compliance issues related to Form 8865

The panel will prepare you to:

• Understand the purpose of Form 8865, the categories of U.S. persons required to file, and gather data to correctly determine allocable share of partnership income
• Report the income and expense statements and balance sheets for taxpayers with 10% or more interest in a foreign partnership or flow-through LLC
• Grasp key U.S. international tax reporting rules and obligations of U.S. persons with interests in foreign partnerships
• Avoid audit red flags and common, serious errors that the Service looks for in Form 8865 and its schedules

Learning Objectives

Upon completing this webinar, you will be able to:

• Determine how to arrive at correct data to complete IRS Form 8865
• Indicate the criteria and reporting requirements for foreign entities to elect their classification for U.S. tax purposes
• Identify the various Schedules of IRS Form 8865 and their uses
• Recognize the key U.S. international tax reporting rules and obligations of U.S. persons with interests in foreign partnerships
• Distinguish between the audit red flags and common, serious errors that the IRS looks for in Form 8865 and its Schedules when net investment income tax must be calculated on IRS Form 8960

• Field of Study: Taxes
• Level of Knowledge: Intermediate
• Advance Preparation: None
• Teaching Method: Seminar/Lecture
• Delivery Method: Group-Internet (via computer)
• Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
• Prerequisite: Three years plus business or public firm experience at mid-level within the organization, preparing complex tax forms and schedules, supervising other preparers/accountants. Specific knowledge and understanding of handling complex challenges in completing IRS Form 8865 and its associated schedules; familiarity with correctly identifying taxpayer category, determining allocable share of foreign income, and avoiding serious, but common, mistakes.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).