Tax Audit - Partnerships Edition Ebook

Chapter 1, Initial Year Return Issues

• This chapter deals with three specific types of expenses:
• Syndication Expenses
• Start Up Expenses.
• Receipt of a Capital or Profits Interest
• Payments Capitalized, Deducted, or Distributed?
• Other issues covered in this chapter include the tax implications of payments made to partners:
• Organizational Expenses
• IRC section 707(a) - Partner or Non-Partner
• Guaranteed Payments

• Partnership's basis in its assets
• Partnership liabilities
• Partner's basis in his or her partnership interest
• IRC section 754 election
• Contributions to the Partnership
• Capital accounts
• Accounting for Book/Tax differences

• The Anti-Abuse Rule
• Impact of IRC section 704(c) on the sharing of non-recourse liabilities
• IRC section 704(c) in the context or depreciable property IRC section 704(c) in the context of amortizable property
• IRC section 704(c) in the context of non-depreciable property
• Reverse" IRC section 704(c) which addresses re-valuations

• Distributions of Property to a Partner that Contributed Built-in Gain or Loss Property
• Distributions of Built-in Gain or Loss Property to a Noncontributing Partner
• Disproportionate Distributions
• Disguised Sales
• Basics - Current and Liquidating Distributions

• Substantiality
• Factors considered in determining the partners' interests in the partnership
• Economic effect
• Allocation of tax credits
• Allocation of items attributable to non-recourse debt