IRS News: Proposed International Changes to Form 1065, U.S. Return of Partnership Income for Tax Year 2021

The Treasury Department and the IRS are proposing updates to the partnership form for tax year 2021 (filing season 2022). The updates will provide greater clarity for partners on how to compute their U.S. income tax liability with respect to international tax matters, including how to compute deductions and credits. The redesigned form and instructions also give useful guidance to partnerships on how to provide international tax information to their partners.  This proposed form would apply to a partnership required to file Form 1065, but only if the partnership has items of international tax relevance (generally foreign activities or foreign partners). The proposed changes would not affect domestic partnerships with no items of international tax relevance.

The IRS is seeking comments from stakeholders during a 60-day period which will begin on the date of the press release.  Those interested are invited to send comments to lbi.passthrough.international.form.changes@irs.gov with the subject line: “International Form Changes.”

See

Draft Form and Instructions

DRAFT Form 1065, Schedule K-2 (PDF)Instructions (PDF)

DRAFT Form 1065, Schedule K-3 (PDF)Instructions (PDF)

Posted by Lewis J. Saret, Co-General Editor, Wealth Strategies Journal..

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