J.R. Tobias Est. and the allocation of partnership income

Article Abstract:

The author discusses the US Tax Court memorandum in Estate of Tobias, regarding partnership income allocation for federal income tax purposes.

United States, Cases, Income tax

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Partnership basis allocation rules add complexity to the code and create uncertainties

Article Abstract:

Partnership in-kind distributions to partners made after Aug 5, 1997 are subject to the outside basis allocation rules in IRC section 732(c) as amended by the Taxpayer Relief Act of 1997. The allocation rules were enacted to discourage transactions resulting in artificial bases increases, but allow greater bases increases for depreciable section 1231 properties received in partnership distributions. Congress should repeal the rules which will increase taxpayer and IRS costs and are subject to new abuse.

Partnerships, Laws, regulations and rules

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Proposed regulations require careful thought before a partnership checks the box to be classified as a corporation

Article Abstract:

Partnerships which are planning to convert to corporations should assess the consequences of choosing either to elect partnership status under IRS proposed check-the-box regulations or using one of the three IRS Revenue Ruling 84-111 methods. The proposed regulations issued in Oct 1997 provide reasonable means of entity conversion. Several problems can be avoided and tax savings can be gained in many cases by making the election.

Business enterprises

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