The IRS should consider expanding the list of revaluation events to include additional transactions that change the underlying economics of the partners’ arrangement, if a reliable FMV for the revalued assets can be established.
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TOPICS / PASSTHROUGHS
Partnership and LLC Taxation
Missing Partnership Merger Definition Raises Questions
Regulations governing the federal income tax consequences of a partnership merger lack clear guidance on when a transaction resulting in the combination of two partnerships into a single partnership constitutes a merger.
Temporary Regulations Prohibit Partners From Being Employees
The IRS issued temporary regulations intended to halt the practice of treating partners as employees of a disregarded entity in order to include them in employee benefit plans.
Final Regulations Clarify COD Rules for Grantor Trusts and Disregarded Entities
The IRS finalized regulations that provide rules for determining who is the “taxpayer” for purposes of applying the Sec. 108 discharge-of-indebtedness rules to a grantor trust or disregarded entity.
Liquidation of an LLC
Rules regarding gain or loss on liquidation are a major reason for formation as an LLC rather than as a corporation.
Regulations Clarify: Partners Cannot Be Employees
The IRS issued temporary regulations clarifying that partners in a partnership that owns a disregarded entity cannot be treated as employees of the disregarded entity.
Rules for Partnership Allocations of Creditable Foreign Taxes Are Amended
Temporary regulations issued by the IRS amend an existing safe harbor that is used for determining whether allocations of CFTEs are deemed to be in accordance with the partners’ interests in the partnership.
Using the “Zero-Value” Approach for Carried Interests
There are risks are associated with valuing carried interest transfers.
Gifts of Partnership Interests
If the general partner has unfettered discretion to make or withhold distributions, any gift of an interest in the partnership may be treated as a gift of a future interest not qualifying for the annual gift tax exclusion.
IRS Asks for Comments Before Issuing Partnership Audit Rules
The IRS requested comments on several issues to assist it in issuing regulations to implement the new rules for partnership audits that were passed by Congress last year to replace the long-standing TEFRA audit regime.
Regulations Clarify Partnership Allocations of Creditable Foreign Taxes
New rules released by the IRS are intended to improve an existing safe harbor for allocating creditable foreign taxes so that they are deemed to be in accordance with the partners’ interests in the partnership.
Congress Changes Partnership Audit Procedures
The Bipartisan Budget Act of 2015 greatly strengthened the IRS’s ability to examine certain partnerships.
Taxation of Worthless and Abandoned Partnership Interests
This article discusses the tax treatment of worthless or abandoned stock and partnership interests.
Current Developments in Partners and Partnerships
This article discusses developments in income allocations, disguised sales, partnership distributions, terminations, and basis adjustments.
2015 Budget Act Makes Big Changes to Partnership Audit Procedures
The act replaces the current TEFRA partnership audit rules and repeals the current special rules for electing large partnerships.
Regulations Forthcoming on Partnership Nonrecognition of Property Contributions
The regulations would create an exception to the general nonrecognition rule for property contributions to a partnership in exchange for a partnership interest.
An Alternate Route to an IPO: Up-C Partnership Tax Considerations (Part 2)
This second article in a two-part series explores common tax considerations preceding and following an IPO employing an Up-C structure.
An Alternate Route to an IPO: The Up-C Partnership Structure (Part 1)
This first article in a two-part series covers the Up-C’s basic structure and how it is implemented.
Chief Counsel Advice Tackles Sec. 752’s Impact on Partnership COD Income
IRS Chief Counsel Advice interpreted whether Sec. 752 should be used to determine whether a
partnership’s debt is recourse or nonrecourse
for purposes of COD income rules.
Congress Makes Changes to Partnership Audit and Adjustment Rules
The new rules would apply to partnership returns filed for tax years beginning after Dec. 31, 2017.
TAX PRACTICE MANAGEMENT
2025 tax software survey
AICPA members in tax practice assess how their return preparation software performed during tax season and offer insights into their procedures.
