Description
Book SynopsisWhat works best for clients? Learn the pros and cons of the LLC, general partnership, limited partnership, and limited liability partnership by focusing on planning and potential tax traps. This title offers a review of distinct advantages of these entities coupled with an examination of the risk members and partners face if they do not have a solid tax plan to minimize their exposure. In addition, the authors explore some of the more intricate rules and regulations of these entities so you can move your working knowledge of partnership and LLC taxation beyond the basics. This book prepares the reader to do the following: Analyze a partnership or LLC agreement to determine whether any special allocations in the agreement will be allowed under Code Section 704(b)Identify the potential economic consequences of special allocations to a partner or LLC memberIdentify the potential tax consequences when a partner or LLC member has a negative balance in his or her capital accountRecognize
Table of ContentsChapter 1 1-1
Allocation of Partnership and LLC Income Under Section 704(b) 1-1
Economic Effect: The General Test 1-3
Deemed Economic Effect 1-13
Alternate Test for Economic Effect 1-14
Substantiality 1-18
Denied Allocations: Deter 1-23
Other Issues 1-26
Allocation of Deductions Attributable to Nonrecourse Debt 1-31
Summary 1-35
Chapter 2 2-1
Allocations With Respect to Contributed Property: Section 704(c)(1)(A) 2-1
The Traditional Method 2-4
The Traditional Method With Curative Allocations 2-13
The Remedial Allocations Method 2-16
Special Rules 2-21
Summary 2-24
Chapter 3 3-1
Allocation of Partnership Recourse Liabilities Under Section 752 3-1
How Liabilities Affect Partner Tax Consequences 3-2
Allocation of Liabilities Among the Partners: In General 3-12
Allocation of Recourse Liabilities 3-15
Chapter 4 4-1
Allocation of Partnership Nonrecourse Liabilities and Related Deductions Under Sections 752 and 704(b) 4-1
Distinguishing Between Recourse and Nonrecourse Liabilities 4-2
Allocation of Nonrecourse Debts 4-7
Treatment of Contingent Liabilities 4-16
Chapter 5 5-1
Advanced Distribution Rules 5-1
Non-Liquidating Distributions Generally 5-2
Distribution of Multiple Properties 5-7
Summary 5-20
Chapter 6 6-1
Adjustments to the Basis of Partnership or LLC Assets 6-1
Section 743: Adjustments Following the Transfer of a Partnership Interest 6-3
Distributions of Partnership Property 6-6
Allocating the Adjustment Amount Among Partnership Properties 6-16
Chapter 7 7-1
Sale of an Interest in a Partnership or LLC 7-1
General Tax Consequences Associated With Sale 7-2
“Hot” Assets and Section 751(a) 7-6
Collectibles and Unrecaptured Section 1250 Gain 7-11
Installment Sales 7-13
Net Investment Income Tax 7-15
Sale of an Active (Non-passive) Interest in a Partnership or LLC 7-16
Sale of a Passive Interest in a Partnership or LLC 7-18
Potential for Termination of the Partnership 7-19
Consequences to the Purchaser 7-25
Tax Glossary Tax Glossary 1
Index Index 1
Solutions Solutions 1
Chapter 1 Solutions 1
Chapter 2 Solutions 4
Chapter 3 Solutions 6
Chapter 4 Solutions 9
Chapter 5 Solutions 12
Chapter 6 Solutions 15
Chapter 7 Solutions 18
