You will likely see two main differences this year:
- More detailed information will be provided to you for the preparation of your individual income tax filings.
- Your K-1s (and K-3s, if applicable) may arrive later this year. This may delay your individual tax filings.
In theory, the new forms won’t change your individual tax returns, but in practice, you may discover that you should have been filing certain forms all along. In theory, the same information that you received before in your Schedule K-1 statements and footnotes will now be provided in a standard, clear format. This shouldn’t change the forms and schedules that are required in your individual returns, but it should make it easier for you to prepare them.
In practice, however, now that entities will need to provide clear, extensive detail:
- Some partnerships and S corporations may find that they have foreign items that must be passed through to you that weren’t fully disclosed in the past, or
- The items that are being passed through to you may now be more apparent, bringing to light additional forms you should have been filing to report foreign ownership or foreign items.
If you discover that you should have been filing additional forms, you may need to amend prior returns or use one of the IRS’s amnesty programs to correct your past filings.
