The Internal Revenue Service has targeted complex partnerships it believes are not in compliance with the tax law for audit. One of the abuses the IRS has attacked is transfers of interests in partnerships which result in an increase in the basis of a partner who is subject to a high marginal income tax rate.
DESIGNED FOR
Tax practitioners who will be advising clients who have an interest in a partnership that is impacted by the new final regulations on basis transfers from one related-party partner to another
BENEFITS
- Understand the final regulations addressing basis shifting from one related party partner in a partnership to another
HIGHLIGHTS
- What is a transaction of interest?
- Reporting transactions of interest on Form 8886
- Why make a Section 754 election?
- Adjustments under Sections 743(b), 734(b), and 732
- Applicable threshold amounts for reporting
- What is a basis shift?
- Who is a material advisor and why is that status important?
- Section 755 rules for allocating the Section 743(b) and Section 734(b) basis adjustments
- Transfers of a partnership interest on death
- What is a substantially similar transaction?
- Who is a “tax-indifferent” party in a partnership?
ADVANCE PREPARATION
None