TXCPA Committee Suggests Reducing the Administrative Burden of K-2 and K-3 Filings

Published: Mar 18, 2025

TXCPA’s Federal Tax Policy Committee urged the IRS to ease Schedules K-2 and K-3 requirements while maintaining tax compliance. It recommends reducing taxpayer burden without compromising foreign activity oversight.

Internal Revenue Service

February 6, 2025

Recently, TXCPA’s Federal Tax Policy Committee issued a letter to the IRS on concerns with burdensome compliance requirements. The committee supports the IRS’s efforts to identify activity with high compliance risk and to make certain partners with international tax issues provide information needed to prepare accurate tax returns. However, the current requirements for Schedules K-2 and K-3 have not set the right balance between enforcement and administrative burden. The committee offered recommendations to assist the IRS in reducing the taxpayer burden associated with filing Schedules K-2 and K-3 without reducing the ability to identify returns with foreign activity tax compliance risk.

See the letter: Domestic Filing Exception Letter

 

 

 

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