The IRS issued proposed regulations that require a nonexclusive six-factor test to determine whether payments from a partnership to a partner are disguised payments.
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TOPICS / PASSTHROUGHS
Partnership and LLC Taxation
Identifying a Partnership Distribution
A partnership distribution may consist of cash, property, or both. In addition, any reduction of a partner’s share of partnership liabilities is treated as an actual distribution of cash.
Extension OK Where Individual Had Apparent Authority to Sign It
A consent to extend the limitation period for the assessment for partnership items signed by the tax matters partner of a partnership in his capacity as the tax matters partner of another partnership was valid because the individual had the apparent authority to sign the consent.
Notice Contains Rules on Gain Recognition for Property Transferred to Foreign Partnerships
The IRS intends to issue regulations under Sec. 721(c) to ensure that a U.S. person recognizes gain either immediately or periodically when it transfers certain property to a partnership that has foreign partners related to the transferor.
Accounting for the Death of a Partner
This column reviews the income tax rules that come into play upon a partner’s death.
Special Care Needed in Dealing With Statute-of-Limitation Issues for TEFRA Partnerships
Audits of flowthrough entities such as partnerships cause administrative complexity for the IRS and taxpayers because the audit sometimes drags on longer than the statute-of-limitation period for the IRS to make an adjustment.
The Tax Adviser 2014 Best Article Award
James M. Greenwell received the award for his article on Sec. 704(c) Allocations.
Regulations Determine Partnership Distributive Shares When Ownership Changes
The IRS issued final regulations on determining partners’ distributive shares of partnership items when a partner’s interest varies during the partnership’s tax year.
Return Due Dates Changed in Highway Funding Bill
The short-term highway funding extension passed by the Senate contains several important tax provisions.
Attacking Transactions to Evade General Utilities Repeal
Temporary regulations prevent corporations from avoiding tax through the use of partnerships.
Proposed Rules Define Disguised Payments for Services in Partnerships
The IRS will apply a six-factor test to determine whether payments to partners are disguised payments for services under proposed regulations.
Reporting Information Regarding LLCs’ Passive Activities
Determining whether each individual member of an LLC materially participates requires assumptions that can pose problems.
Making a Valid Sec. 754 Election Following a Transfer of a Partnership Interest
It is not uncommon for a partnership to attempt to make a valid Sec. 754 election, only to find that it failed to satisfy regulatory requirements.
The Exclusion for Meals and Lodging
This article explains the general exclusion under Sec. 119(a) and the other limited exclusions for meals and lodging received from an employer and addresses whether a partnership may treat a partner as an employee for purposes of the Sec. 119(a) exclusion.
Selling Partnerships That Own CFCs: A Potential Trap for the Unwary
Should gain recognized on a sale of a partnership that owns CFC stock be treated as capital gain or ordinary income?
Incorporating a Partnership and Selling to an ESOP in a Tax-Free Transaction
This item explores the main issues a partnership should consider from a restructuring perspective when considering ESOP ownership transactions.
Identifying What Constitutes Partnership Liabilities and How They Affect the Basis of Partnership Assets
Only partnership debt that has an impact on the partnership’s inside basis is a liability. All other debt is excluded from consideration.
The Importance of Being Flexible: Choice-of-Entity Considerations
This item presents an overview of some of the tax points that should be kept in mind when choosing an entity.
Proposed Regulations Would Require Gain or Loss Recognition on Certain Installment Obligation Transfers
The IRS issued proposed regulations that would require transferors that transfer installment obligations for equity interests in corporations or partnerships in nonrecognition transactions in satisfaction of those obligations to recognize gain or loss.
Current Developments in Partners and Partnerships
This article reviews and analyzes recent regulations, rulings, and cases involving partnerships, including developments in partnership formation and operations, income allocations, and basis adjustments.
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.
