A tax innovation for the partnership filing process

Case study: Innovating for faster tax filing

Challenge

The tax filing process for investment partnership has become increasingly complex, forcing finance and tax departments to spend significant time on forms and spreadsheets to meet tax compliance rules. Investment partnerships are tiered, so tax liability varies depending on the income earned by partners at each level. Tax directors and CFOs who are responsible for meeting compliance rules need quick, effective tools to advise investors in these partnerships.

Innovation

Deloitte developed the iPACS to simplify the tax filing process. An automated, customized environment facilitates the work:

• Data collection
• Workpapers that document the filings
• Allocations for partners
• Tiering

iPACS facilitates high-volume production of K-1 forms specifying each partner’s share tax liability. The iPACS solution provides engagement teams additional time for request responses so they can operate at broader scale.

iPACS also allows engagement teams to find and evaluate data across countries—giving clients an ability to receive timely summaries of tax requirements in other markets, even for thousands of the partners that make up such partnerships.

Impact 

iPACS facilitates and enhances operational decisions by reducing the time needed to deliver critical tax insights.

Highly complex reports that normally take weeks or months are now possible in a fraction of the time.

Making K-1s available to investors and the ability to create customized reports are particularly significant for Deloitte and its clients. Some examples:

• A multinational private equity fund cut delivery of K-1 forms to investors by three months. This allowed the fund to set unit prices on a more timely basis for investors.
• In the first year using iPACS, Deloitte processed 4,000 K-1 filings. Utilizing iPACS this year, Deloitte expects to produce nearly 10 million K-1s.
• Deloitte uses iPACS on more than 250 client engagements.