Prop. Regs. discuss disguised sales

Article Abstract:

The IRS has issued Proposed Regulations regulating transfers of interests in partnerships. To be genuine, the transfer must represent an exchange of a contribution to the partnership for an entrepreneurial interest. If this exchange does not occur, the transaction will be recognized as a disguised sale under Proposed Regulations for Section 707(a)(2) of the Internal Revenue Code. Disguised sales are exchanges between the partnership and persons other than members of the partnership. Transfers made more than two years apart between a partnership and a partner are not recognized as sales, while transfers made within two years are recognized as sales.

Tax accounting, Partnership, Partnerships, Revenue

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Prop. and Temp. Regs. show how new straddle rules work

Article Abstract:

The Temporary and Proposed Regulations from the Internal Revenue Service related to tax straddles are explained. Tax accounting rules apply to wash sales, short sales, loss deferrals and mixed straddles. The regulations are designed to prevent taxpayers from converting short-term capital gains and ordinary income into long-term capital gains for income tax purposes through the use of tax straddle transactions. Examples of proper and improper tax accounting procedures under the regulations are provided.

Finance, taxation, & monetary policy, United States, Interpretation and construction, Taxation, Tax law, Tax administration and procedure, Tax administration, Capital gains tax, Tax shelters, Commodity swaps

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