An LLC member’s distributive share of LLC income and loss from a trade or business is generally subject to self-employment tax, raising several issues around guaranteed payments, retirement payments, rental income, and members who are employees of the LLC.
Contributions, Distributions & Basis
For certain partners, the presumed preference for receiving a distributive share of income (including a priority profit allocation) may need further evaluation to determine how it coordinates with various international tax provisions.
This item considers to what extent taxpayers may be able to apportion basis instead under Sec. 704(c) principles.
When an LLC interest is transferred, the transferee’s basis depends on the transferor’s basis and numerous other potential factors.
The discussion covers developments in the determination of partners and partnerships, gain on disposal of partnership interests, partnership audits, and basis adjustments.
Partnerships and their partners need to work closely to maintain strong communications to overcome challenges to information sharing and, ultimately, to computational matters and information reporting.
This article focuses on the Sec. 465 at-risk limitation, one of the rules that could disallow all or part of a partner’s deduction of an allocable loss from a partnership.
The IRS finalized proposed regulations on certain carried interests to account for changes made by the TCJA.
The IRS finalized proposed regulations on certain carried interests to account for changes made by the Tax Cuts and Jobs Act (TCJA). The TCJA extended from one year to three years the holding period for making carried interests eligible for capital gain treatment.
This item discusses proposed regulations regarding the tax treatment of carried interests.
The IRS issued proposed regulations under Sec. 1061, enacted by the TCJA, which requires owners of certain partnership interests to hold them for three years to be eligible for capital gain treatment.
Payments to ex-wife and divorce lawyer do not increase taxpayer’s basis in an LLC.
While the ability to temporarily file amended returns is welcome by many BBA partnerships, some unanswered questions remain about the consequences of doing so, and in some circumstances filing an AAR could be preferable.
The IRS issued proposed regulations under Sec. 1061, enacted by the law known as the Tax Cuts and Jobs Act, which requires owners of certain partnership interests to hold them for three years to be eligible for capital gain treatment.
This discussion considers reasons the purchaser of a partnership may want to rethink the use of such shortcuts when estimating the federal income tax consequences associated with a Sec. 743(b) adjustment in an acquired partnership interest.
Deduction limitations of Sec. 162(m) to compensation paid by partnerships in Up-C and UPREIT structures
Proposed regulations change the paradigm for the tax treatment of compensation paid by a partnership situated below a publicly held corporation in an Up-C or UPREIT structure.
This item discusses the authority to consider when determining whether the general partner of an investment fund is engaged in a Sec. 162 trade or business.
This article discusses developments in the taxation of partnerships and partners, debt and income allocations, distributions, and basis adjustments.
This item discusses the tax basis and partnership capital accounting impacts of partner-incurred syndication costs.
Partnerships making guaranteed payments may want to consider restructuring them as priority profit allocations.