Understanding Schedules K-1
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In this 3rd course of the Federal Tax Return Analysis Skill Series, participants will review Part I of Schedules K-1 (Forms 1065 and 1120S), examine Part II of Form 1065 focusing on financing liabilities, compare both forms, and track Part III data to personal income tax returns.
Certificate
1 credit or $295
Cost
1.5 - 2 Hrs.
Duration
1 hr.
Prep Time
1
Quiz
Overview
In the third webinar session, participants review the information content captured in Part I on Schedule K-1 (Form 1065) and in Part I on Schedule K-1 (Form 1120S). They examine the information provided in Part II on Schedule K-1 (Form 1065) with specific attention to amounts recorded for a) non-recourse financing liabilities, b) qualified non-recourse financing, and c) recourse financing for a partnership or limited liability company. They explore the similarities and differences between Schedule K-1 (Form 1065) and Schedule K-1 (Form 1120S) with respect to information requirements and their relevance to analysis. In addition, participants track the migration for data entered in Part III of both schedules to specific locations on the personal income tax returns. Further, they identify cash and non-cash amounts recorded in Part III on both Schedules K-1 and again on the designated schedules in the personal income tax returns.
Who Should Attend
This Course is ideal for participants currently in or aspiring to enter the following job functions:
- Credit Management
- Commercial Credit Administration
- Commercial Loan Administration
- Commercial Loan Portfolio Management
- C & I Lending
- Corporate Lending
- Loan Review
- Special Assets
- Internal Audit
- Non-Profit and Municipality Lending
- Health Care Provider Lending
- Specialized Lending
- Credit Analysis
Prerequisites
Familiarity with accrual financial statements and the use of ratios and cash flow statements in assessing borrower risk.
Objectives
By the end of the webinar session, participants will be able to:
- Identify the purpose and information content of Schedule K for a partnership or limited liability company (Form 1065) and for a Subchapter S corporation (Form 1120S) and understand the relationship between each Schedule K and Schedule K-1 for both partnerships or limited liability companies and Subchapter S corporations.
- Identify any significant differences between the two Schedules K and associated Schedules K-1 and explore the apparent reasons for those differences.
- Track the information flow from Schedule K-1 (Form 1065) and from Schedule K-1 (1120S) to the owner's and partner's personal income tax returns.
- Identify the cash and non-cash amounts of revenue and expenses mapped from Schedule K-1 (Form 1065) and from Schedule K-1 (Form 1120S) to the personal income tax returns.
- Define non-recourse, qualified non-recourse, and recourse financing reported on Schedule K-1 (Form 1065) and identify the use of that information in establishing partner obligations and guarantees.
- Assess the most pragmatic use of information in the Schedules K-1 to assist in the process of assessing borrower and guarantor risk.
Materials(access provided with registration)
- Credit Refresher on Schedule K-1 (Form 1065)
- Credit Refresher on Schedule K-1 (Form 1120S)
- Excerpts from Partner's Instructions for Schedule K-1 (Form 1065)
- Excerpts from Shareholder's Instructions for Schedule K-1 (Form 1120S)
- Excerpts from Form 1065 for Information Access Partners
- Excerpts from Form 1120S for Information Access, Inc.
- Excerpts from Form 1040 for Peter Keys
- Exercise for the Session 3 Webinar
- Webinar Presentation Slides
- Webinar Poll Questions
- Webinar Poll Solutions
- Exercise Solutions
This is Course 3 of 8 in the Federal Tax Return Analysis Skill Series
Business Income Tax Returns
The Section 179 Deduction
Understanding Schedules K-1
Personal Income Tax Returns and Cash Flow
Schedule M-1 and the Accrual Income Statement
Business Income Tax Returns and Ratio Analysis
Business Income Tax Returns and Cash Flow Analysis
Cash Based Income Tax Returns
