1. Topics

S Corporation, Partnership & LLC Taxation

IRS proposes regs. on withholding on transfers of partnership interests

The IRS issued proposed regulations on the operation of new Sec. 1446(f), which requires withholding on the transfer of a partnership interest described in Sec. 864(c)(8) (gain or loss of foreign persons from the sale or exchange of certain partnership interests).

Distribution by former S corporation is part dividend

The IRS ruled that a distribution to the sole shareholder of a C corporation was partly a recovery of the former S corporation’s accumulated adjustments account (AAA) and a taxable dividend for the remaining distribution.

Proposed rules would govern withholding on transfers of partnership interests

The IRS issued proposed regulations on the operation of new Sec. 1446(f), which requires withholding on the transfer of a partnership interest described in Sec. 864(c)(8) (gain or loss of foreign persons from the sale or exchange of certain partnership interests).

IRS finalizes centralized partnership audit rules

The IRS issued final regulations on the centralized partnership audit regime, which generally assesses tax at the partnership level.

Sec. 199A and the aggregation of trades or businesses

Aggregation may allow a taxpayer to claim a greater QBI deduction than if the wages and capital limitation was applied separately.

2018 partnership Schedule K-1 changes

This article discusses the new items practitioners should be aware of.

LLC owned solely by spouses: A partnership or a joint venture?

A timely election allows a married couple in business together to avoid the partnership filing rules.

Publicly traded partnerships: Tax treatment of investors

This article explains the tax implications of owning and selling an interest in a publicly traded partnership treated as a partnership and the tax reporting and compliance challenges that an investor in a PTP may face.

Revisiting at-risk rules for partnerships

Treasury never finalized the bulk of the regulations implementing Sec. 465, so reliance on proposed regulations issued in 1979 is the norm.

Deduction allowed for partnership-related debt

A note contributed to a partnership by an individual in exchange for an interest in the partnership was a bona fide debt.

Terminating an S election by revocation

Revoking an S election may be the best course in some cases, but timely filing and shareholder consent are required.

Nonresident alien as an indirect S corp. shareholder

The TCJA fundamentally relaxed the rules on S corporation ownership by allowing nonresident aliens to be potential current beneficiaries of ESBTs and, therefore, indirect corporation shareholders.

Traps for the unwary: Tax Cuts and Jobs Act changes

This article lists the changes together, along with some unexpected nuances.

Potential pitfalls of charitable contribution substantiation and reporting

Failure to properly complete all required fields on Form 8283, including the donor’s cost or other basis, could jeopardize the entire deduction with respect to the donated property.

No deduction for donated easements with flexible reserved building rights

A taxpayer’s conservation easement deductions were denied because the easements allowed for changes in the use of the property.

Current developments in S corporations

This update on recent developments in taxation relating to S corporations includes cases and rulings on eligible shareholders, electing small business trusts, inadvertent S election terminations, and other issues, as well as changes made by the TCJA.

IRS finalizes centralized partnership audit regulations

The IRS issued final regulations on the centralized partnership audit regime, which generally assesses tax at the partnership level.

Current developments in partners and partnerships

This article reviews and analyzes recent rulings and decisions involving partnerships and discusses developments in partnership formation, debt and income allocations, distributions, and basis adjustments.

IRS takes narrow view of aggregation under the at-risk rules

The IRS concluded that a taxpayer was not permitted to aggregate the S corporations with the partnership for the purpose of applying the at-risk rules of Sec. 465.

Repeal of technical terminations: What will and will not be missed

With the repeal of technical terminations, partnerships can only terminate for U.S. federal income tax purposes if no part of any business, financial operation, or venture continues to be conducted by any of its partners.
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