It isn’t too late to get it right in filing your 2021 tax return if you are a partnership, S corporation, or stakeholder in a foreign partnership, by reporting items of “international tax relevance” on IRS Forms K-2 and K-3. This can even include the requirement to report by entities that have no foreign activities or nonresident stakeholders.
The scope of information that must be reported is broad.
For tax years beginning in 2021, a partnership must file Schedule K-2 (partners’ total international distributive share items) and Schedule K-3 (partners’ share of international income, deductions, credits, etc.), if the partnership has relevant international tax items. The 2021 Form 1065 Schedule K-2 reports items of international tax relevance and is an extension of the Form 1065, Schedule K. It replaces line 16a-r, portions of line 20, and numerous unformatted statements attached to prior versions of the Schedule K.
For more information on what is required, click here.