By Ed Zollars, CPA
The IRS late on Tuesday issued the following statement by the National Public Liaison’s office:
“The IRS intends to provide certain additional transition relief for this year from the Schedule K-2 and K-3 reporting for certain domestic partnerships and S corporations with no foreign activities, foreign partners, or shareholders, and without knowledge of partner or shareholder need for information on items of international relevance,” the agency said in a February 15 statement.
“For 2021, these qualifying domestic partnerships and S corporations will not have to file the new schedules,” the statement continued. “We are taking this step in response to feedback we received from the tax community and our stakeholders. The IRS will provide full details of this relief soon.”
Those further details arrived the next day on Feb. 16 with News Release IR-2022-38. The relief is also outlined in frequently asked questions on the IRS website (see FAQ #15). The transition relief announced Wednesday is welcome news for eligible pass-through entities who will not have to file new Schedules K-2 and K-3 for tax year 2021.
And stay up to date through OSCPA’s Monthly Federal Tax Update Webcast. The March 7 session will cover all K-2/K-3 changes and updates.
Reposted with permission.