This article reviews how depreciation from a partnership is allocated between a trust and its beneficiaries and highlights the potential trap the allocation can cause when the depreciation deduction flows through a partnership.
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TOPICS / PASSTHROUGHS
Contributions, Distributions & Basis
Technical Terminations: Tangible Personal Property Depreciation Issues
Editor: Mary Van Leuven, J.D., LL.M. Technical terminations of partnerships under Sec. 708 (b)(1)(B) and its regulations create numerous issues as to the proper tax treatment of depreciable tangible property owned by the terminating partnership, particularly when changing its accounting method for such property. Under Regs. Sec. 1.708-1(b)(1)(iv), the new
employee benefits & pensions
Profits interests: The most tax-efficient equity grant to employees
By granting them a profits interest, entities taxed as partnerships can reward employees with equity. Mistakes, however, could cause challenges from taxing authorities.