Class 5d Partnerships Basis & Distributions

Class 5d Partnerships Basis & Distributions -...

Info iconThis preview shows pages 1–7. Sign up to view the full content.

View Full Document Right Arrow Icon
Taxation of the Business Entity Online Lecture Series Presented by Akore Berliner, CPA Basis and Distributions Issues of  Partnerships
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Basis Issues Partner’s basis is important for  determining: 1. Deductibility of partnership losses  2. Tax treatment of partnership distributions 3. Calculating gain or loss on the partner’s  disposition of the partnership interest C11-2
Background image of page 2
Basis of Partnership Interest For new partnerships, partner’s basis  usually equals: Adjusted basis of property contributed,  plus FMV of any services performed by partner  in exchange for partnership interest
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Basis Issues Each partner has a basis in their  partnership interest Partner’s basis is adjusted for income and  losses that flow through This ensures that partnership income is only  taxed once
Background image of page 4
Basis Issues  Partner’s capital account balance is usually  not a good measure of a partner’s adjusted  basis in a partnership interest for several  reasons e.g., Basis includes partner’s share of  partnership liabilities; Capital account does  not
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Basis of Partnership Interest For existing partnerships, basis depends on  how interest was acquired If purchased from another partner, basis =  amount paid for the interest If acquired by gift,  basis = donor’s basis 
Background image of page 6
Image of page 7
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 20

Class 5d Partnerships Basis & Distributions -...

This preview shows document pages 1 - 7. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online