Schedule K-3 took the pass-through world by storm this past filing season. Together with Schedule K-2, the changes to Forms 1065, 1120-S and 8865 represented a significant expansion in the amount of U.S. international tax information required to be reported on partnership and S corporation tax returns. All pass-through entities with items of international tax relevance were required to file a Schedule K-3. While K-3 instructions have been provided, many professionals are still seeking clarity.
Brian Moreira, a senior manager at RSM who focuses on the financial services industry, discussed the Schedule K-3 requirement, the challenges that resulted and how technology could minimize them.