Partnership Tax Compliance (First-Year Trader Client) – Partial Payment & Minimum Price

Please only purchase this first-year tax compliance service if we invited you to.

Price: $1,795.00

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Update June 15, 2021
If you used our entity formation service to form your LLC taxed as a partnership in 2021, you might be interested in our 2021 tax compliance service. 
 
Next step: At your request, we'll schedule a new client evaluation (NCE) for your LLC/partnership using our 15-minute add-on consultation service ($105). We'll email you that service link; it's not in navigation. In the NCE, Darren Neuschwander or Adam Manning will look at your consultation and entity formation memos and confirm you have executed the appropriate steps like using an entity trading account. They will give you a quote estimate of our fees and an idea of the value you might receive from using our tax compliance service. Finally, we hope to invite you to purchase our product: Partnership Tax Compliance (First-Year Trader Client) – Partial Payment & Minimum Price. If you also want our 2021 individual tax compliance service, discuss that with Neuschwander or Manning, too. 

Our tax compliance service includes

  • Planning and preparation of your partnership federal and state tax returns.
  • Assessment of trader tax status (TTS): If the partnership qualifies for TTS, we can use business expense treatment on Form 1065. TTS does not require an election, whereas Section 475 MTM does.
  • If the partnership is not eligible for TTS, then it will pass through investment expense treatment to owners. The 2017 Tax Cuts and Jobs Act suspended investment expenses and all other miscellaneous itemized deductions for individuals.
  • In a tax return footnote, we explain trader tax law, how the partnership qualifies for TTS, tax elections like Sections 475 MTM, the tax treatment on financial products, and more. Avoiding IRS questions is vital.
  • If you traded securities, there is complicated accounting for wash sale loss adjustments or Section 475 MTM accounting, including a Section 481(a) adjustment for the first year of the election. Consider our trade accounting service in conjunction with our tax compliance service.
  • A timely-filed Section 475 MTM election by a new or existing partnership. An existing partnership must also file a Form 3115 (Change of Accounting Method).
  • Tax treatment for traders can be confusing, and we get it right, taking advantage of losses where possible and lower Section 1256 60/40 capital gains rates. Traders can depart from broker 1099-Bs where entitled, and we explain it in the tax return footnotes.
  • A partnership may provide for "unreimbursed partnership expenses" (UPE) in the partnership agreement. UPE includes home-office deductions.
  • 2017 Tax Cuts and Jobs Act: We maximize the 20% deduction on qualified business income in pass-through entities.
  • "Special allocations," including profit allocations (carried interest), are allowed on partnership tax returns.

Special considerations

Choose the partnership tax compliance service if you had a trading company organized as a general partnership, multi-member LLC (limited liability company), or LP (limited partnership) filing as a partnership.

We will focus on the 2017 Tax Cuts and Jobs Act, especially the new 20% deduction on qualified business income (QBI) in pass-through entities. QBI might include Section 475 ordinary income, whereas the new law and regs exclude capital gains from QBI. There are income phase-outs for owners of service businesses, including a TTS trading company, and wage and property limitations for all types of pass-through entities. It's wise to do year-end tax planning to maximize the 20% QBI deduction, which owners deduct on their individual tax returns. (See How Traders Can Get 20% QBI Deduction Under IRS Proposed Regulations.)

The IRS does not allow a trading or investment partnership to have "guaranteed payments," which is how partnerships compensate partners for services rendered.  If you want employee benefits, including health insurance and a retirement plan, consider having your partnership elect S-Corp tax status by Mar. 15 of the current tax year. An S-Corp creates earned income with officer compensation. TTS companies need officer compensation if they are in the phase-out range for the QBI deduction.

Trading income is not self-employment income (SEI) on a partnership tax return. Exception Section 1402(i): Full membership on a futures exchange, trading Section 1256 contracts on that exchange, is SEI.

After purchase, our administration team will follow up with you by email to commence the tax compliance process. See how our virtual process works efficiently.

Kindly expect a balance due on our fees when we complete the tax compliance engagement. Please read Price & Billing Policies for more information.

If you have any questions, please contact us.

Thank you for trusting our firm to help you. We've earned trust from traders since 1983.

Sincerely,
Robert A. Green, CPA
Darren L. Neuschwander, CPA
Adam W. Manning, CPA
Members, Green, Neuschwander & Manning, LLC