Dispositions and Partial Dispositions of a Partnership Interest
Emory University School of Law
January 19, 2008
While the computation of gain or loss on the sale of a partnership interest seems easy to determine, it can be problematic if some but not all of the partner's interest is sold. In addition, if the selling partner has been allocated a share of the entity's indebtedness under section 752, a naive application of the usual debt allocation rules can produce results that are inconsistent with the underlying economics of the transaction. Finally, determining the ancillary tax consequences of the sale including the proper post-sale sharing of built-in asset gain can be complex, especially when the selling partner has received a debt-financed distribution prior to the partial disposition. Fortunately, by ensuring symmetric tax consequences between the selling and purchasing taxpayers, sensible results can be reached.
Number of Pages in PDF File: 17
Keywords: law, tax, partnership tax
JEL Classification: K34working papers series
Date posted: November 22, 2007 ; Last revised: January 21, 2008
© 2013 Social Science Electronic Publishing, Inc. All Rights Reserved.
This page was processed by apollo3 in 0.406 seconds