Passthroughs
The IRS finalized proposed regulations under Sec. 6223 on the procedures for designating a partnership representative and the authority of the partnership representative under the centralized partnership audit regime.
Lender Management contended that its activities met the test for an active trade or business under guidelines.
The net value rule determines the extent to which a
partner who owns a partnership interest through a disregarded entity bears the economic risk of loss
for a partnership recourse liability.
This discussion gives a historical perspective of the treatment of the sale of a partnership interest and the changes enacted as part of the TCJA.
In the typical closely held business context, the TCJA’s reduction of corporate tax rates to a flat 21% is far from a panacea.
The IRS should provide a simplified adjustment procedure for partnership audits, the AICPA recommended in a letter to the IRS Chief Counsel’s Office.
The regulations’ definition of an ‘eligible partner’ is key to determining whether a partnership can elect
out of the centralized partnership audit regime.
A taxpayer who pays the full FMV for a partnership interest that has forward Sec. 704(c) property associated with it and who subsequently contributes
it to another partnership may not receive the expected tax deductions.
The IRS announced that it was withdrawing temporary regulations on the treatment of partnership liabilities for disguised-sale purposes and proposing to reinstate the old rules.
Regulations remove basis benefit for an LLC member when circumstances indicate a plan to circumvent or avoid debt payment obligation.
The $1.3 trillion spending bill passed by Congress includes IRS funding and tax-related technical corrections, including changes to the centralized partnership audit regime.
The technical question and answer helps financial statement preparers account for the amount a partnership pays the IRS for previous underpayments of tax, interest, and penalties.
The IRS should provide a simplified adjustment procedure for partnership audits, the AICPA recommended in a letter to the IRS Chief Counsel’s Office.
Individuals, partnerships, or other noncorporate entities that could not benefit from a Sec. 338(h)(10) election may be able to qualify for a Sec. 336(e) election.
The IRS announced that S corporations are subject to the new extended three-year holding period applicable to carried interests.
The IRS issued proposed regulations addressing how partnerships and their partners adjust tax attributes to take into account partnership adjustments under the new centralized partnership audit regime.
The new deduction allows certain business owners to keep pace with the significant corporate tax cut provided by the Tax Cuts and Jobs Act.
Loans among related entities were not bona fide
indebtedness that would give rise to debt basis in an S corporation for the shareholder.
A partner’s basis is key to determining the application of loss limitations and the recognition of gain or loss on partnership distributions and dispositions of partnership interests.
Publicly traded partnerships can present challenges for
reporting.
