Passive Syndication K1 Question on File and Amend vs Extension

[Duke Giordano]

Hey all, 

I had a quick question for you as I am a passive syndication investor in multiple syndications in the range of 10+ K1's annually and there are a few K1's that are coming in late but expected sometime in late May. My options were to file and amend the return when i get K1's vs not filing and applying for extension until Oct.

Based on my current tax situation I was actually receiving a fairly substantial refund from the IRS and my CPA he has recommended we file return and then amend the return when we get the new K1's as opposed to file an extension since I'm being offered a refund from the IRS. I was curious based on some of the CPAs out there what the difference or pros and cons would be to filing and amending the return versus an extension. Is there any difference?  In the case as outlined by my CPA is there any drawbacks to amending the return or is either strategy is perfectly acceptable.  His main reasoning for trying the amended return versus the extension is once again because I was due a fairly decent refund from the IRS and his suggestion was to not let that money just sit there gaining interest from the IRS versus where I could deploy to tell their investments.  Thanks in advance for your time and insight and I'm curious anyone who also experienced these two options.

[Duke Giordano]

@Monty Bruckman

Hi Monty,

This is not tax advice, and I am not a tax professional.  However, what my CPA does is tracks income/losses for each state unless it exceeds a threshold amount and keeps track of that number.  Then, at the time of sale/refi of the property with a large income event then he files in those states.  Others may have different experience but that is what mine does to avoid filing multiple state returns each year for excessively small amounts of income.  This is just my experience, hope that helps.