Video: Introduction to Partnerships: Operations

In this lesson, Nick Palazzolo, CPA, dives into the intricate world of partnerships, focusing specifically on their operations. Starting with a refresher on the essential Form 1065, he breaks down the components that comprise ordinary income and how these elements flow through to the Schedule K and K-1, critical for both exam preparation and practical comprehension. With a detailed explanation of the Schedules L, M-1, and M-2, Nick ensures that the foundational understanding of partnership assets and reconciliations are clear. His conversational approach, mixed with practical tips, ensures that whether one's goal is to master partnership taxation for practice or to confidently tackle partnership questions on the exam, the necessary tools are at hand for success. The lesson wraps up by illustrating the importance of understanding how a partner's share of income is reported through Schedule K-1 and how it impacts their individual tax return, complete with practical examples to solidify these concepts.