It is not uncommon for a partner to engage in a business transaction with a partnership of which he is a member. If the partner engages in a transaction with his partnership other than in his capacity as a partner, he will be treated as if he were not a member of the partnership with
Contributing Encumbered Assets: Partnership Disguised Sale Rules
Many of our posts this year have considered some of the unique issues that are presented by a partner’s contribution of property to a partnership, including the application of the “disguised sale” rules. Today, we will review one aspect of a recent IRS ruling involving a partnership’s assumption of liabilities in connection with a partner’s
Disposing of Real Property in a Tax-Advantaged Manner
Do you mean to tell me, Katie Scarlett, . . . that land doesn’t mean anything to you? Why, land is the only thing in the world worth workin’ for, worth fightin’ for, worth dyin’ for, because it’s the only thing that lasts. – Gerald O’Hara, from “Gone With The Wind”
Many of our clients
Happy Halloween: Partnership “Disguised Sales” (Get It?)
What Is It?
Assume that X and Y agree to the following: X will transfer ownership of Prop to Y, and Y will transfer cash to X.
What just happened? No, this is not a trick question. Obviously, X has sold Prop to Y. If the amount of cash that X receives is greater than