Partnership and LLC Taxation

Converting a sole proprietorship to an LLC

The conversion affords the advantage of limited liability, often with minimal changes in federal tax treatment.

Digital asset question added to more forms for 2023 tax returns

IRS adds a question about digital assets to forms covering partnerships, corporations, S corporations, and estates and trusts.

Missed Sec. 83(b) elections: Partnership and LLC special issues

This discussion focuses on grants of profits interests in a partnership or LLC and the relevance of Sec. 83(b) elections.

Prop. regs. issued on conservation easement deduction disallowance

The IRS on Friday issued proposed regulations providing guidance on the new rule that disallows charitable contribution deductions for certain conservation easement contributions by partnerships and other passthrough entities.

Penalties against LLC approved by IRS supervisor, Tax Court holds

In Salacoa Stone Quarry, LLC, the Tax Court held that penalties for misstatement of a charitable conservation easement’s value were properly approved by an IRS supervisor, despite a discrepancy in dates on the penalty approval documents.

LLC distributions that liquidate a member’s interest

Factors potentially causing taxable gain (or loss) from a liquidating distribution include the member’s outside basis and the nature of any property the member contributed to the LLC.

Beneficial ownership information reporting: Right around the corner

Clients should start developing procedures and policies to comply with the new reporting requirement and begin to gather the data that will be necessary.

Massachusetts state tax implications for sales of PTE interests

When the sale of an interest in a PTE is contemplated, planning for state sourcing and taxability of the gain should both be considered so the owners avoid a large — and sometimes unexpected — state income tax liability.

Proposed PFIC regulations could complicate elections and reporting

Proposed regulations would extend to PFICs the aggregate treatment of U.S. partnerships and S corporations for Subpart F income.

Disguised sale of a QOZ partnership interest

Several structural issues arise when a QOZ project involves using both private developer capital and third-party investor equity.

Passthrough-entity treatment of foreign subsidiary income

Entities such as S corporations and partnerships, as well as sole proprietorships, should carefully consider the U.S. tax treatment of foreign subsidiaries.

Partnership extraordinary-item treatment for accounting method adjustments

The regulations under Secs. 481(a) and 706 set forth rules governing a partnership’s treatment of accounting method changes and partner allocations but do not provide clear guidance on how income from an unfavorable Sec. 481(a) adjustment should be allocated among partners with varying interests during the four-year recognition period.

Single-member LLCs

A single-member limited liability company can adopt a variety of tax classifications to fulfill desired business purposes, besides conferring limited liability protection on its owner.

Ninth Circuit again addresses return filing

Faxing a return copy to an IRS agent or mailing it to an IRS attorney is not ‘filing’ the return.

Transfers of PTP interests: Options for foreign intermediaries

This item summarizes the options available to foreign intermediaries for transfers of PTP interests under current guidance and comments on some practical benefits and burdens of each.

Impact of business interest expense limitation regs. on partner redemptions

This item analyses two related examples of partner redemptions — with and without Sec. 163(j) basis adjustments — to highlight and clarify both the existing and new issues.

Nonresident alien partner’s gain on inventory items sourced to US

Nonresident alien’s Sec. 751 gain on sale of partnership interest was sourced to United States.

PTE deduction: Timing issues for accrual-method taxpayers

taxpayers and practitioners face uncertainty regarding the timing of the deduction provided for in Notice 2020-75.

Navigating partnership continuations

This item discusses the rules and authorities related to partnership continuations and when they may apply.

Current developments in partners and partnerships

This article reviews and analyzes recent rulings and guidance involving partnerships. The discussion covers developments in the taxation of partnerships and partners, debt and income allocations, distributions, and basis adjustments.
Next
Previous