The following commentary does not necessarily reflect the views of AgWeb or Farm Journal Media. The opinions expressed below are the author's own.
Paul is now part of the fourth generation in America that is involved in farming and hopes the next generation will be involved also. Through his blog he provides analysis and insight to farmer tax questions.
Many of our farm entities have fiscal year-ends that will end before December 31, 2018. Most of them will be September 30, 2018 or later, however, there are many fiscal year pass-through entities with a year-end before then. These tax returns will be using the old 2017 Schedule k-1's to report information to their owners and they have not been updated for the new Section 199A deduction. There will be a lot more information that needs to be provided on this Schedule and there will not be an appropriate box to place information in like the old Section 199 deduction. Therefore, you will need to manually input this information and provide it to the owners. At a minimum, the following is required (a separate reporting for each trade of business if more than one):
There may end up being additional information required to be listed related to ownership to allow owners to make an aggregation election. The aggregation election is made by the individual owner, but I can see some type of requirement to list on the Schedule k1 those entities under common ownership. That requirement is not currently listed in the proposed regulations, but I can see it becoming a requirement.
As you can see, preparing RPE returns will become much more complicated and returns being filed now need to know what information is required (even if the form is not ready).
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