The Indiana CPA Society, the AICPA and 52 state CPA societies sent a letter to Assistant Treasury Secretary Lily Batchelder and IRS Commissioner Charles Rettig today regarding widespread concerns on the Schedules K-2 and K-3 reporting. The letter states:

“The AICPA and state CPA societies across the country call on the Treasury Department and the IRS to delay implementation of the Schedules K-2 and K-3 to 2023 (the 2022 tax year filing season) and to suspend any assessment of penalties against Partnerships or S Corporations for failing to file or failing to timely provide Schedules K-2 and K-3 for the 2021 tax year.”

INCPAS is strongly supporting these efforts and is advocating on behalf of members to urge IRS and Treasury to delay implementation of these changes in order to allow practitioners sufficient time to understand and implement these changes.

Mid-tax filing season updates to the Schedules leads to confusion and unintended errors. Delaying also allows the IRS adequate time to complete the e-File system in order to accept the new Schedules electronically. INCPAS is also echoing calls to suspend penalties for failing to file, or failing to provide in a timely manner, Schedules K-2 and K-3 for the 2021 tax year.

"We acknowledge the tremendous effort of the IRS and Treasury to develop redesigned Schedules. Unfortunately, there are still too many questions surrounding their successful implementation," says INCPAS President & CEO Courtney Kincaid, CAE. "The results of a rushed implementation are, likely, incomplete and inaccurate returns. It is our hope that the requested delay would help avoid further complicating an already complicated tax filing season. We are grateful for this opportunity to continue amplifying the voices of Indiana taxpayers and their preparers."

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The Indiana CPA Society is a statewide professional association representing nearly 7,000 CPAs and accounting professionals who are transforming business in Indiana. For more information, visit incpas.org.