Allocations Made in Accordance with Partners' Interests in the Partnership

Business Entities, Vol. 11, p. 4, November/December 2009

30 Pages Posted: 4 Dec 2009  

Bradley T. Borden

Brooklyn Law School

Date Written: December 1, 2009

Abstract

Tax law allocates partnership tax items in accordance with the partners' interests in the partnership if the allocations do not have substantial economic effect. Tax law also uses the partners' interests in the partnership to test whether certain allocations satisfy the test for substantiality. These rules that rely upon partners' interests in a partnership are at the heart of partnership taxation. Nonetheless, tax law does a poor job of defining partners' interests in a partnership. This article illustrates the problems that arise because of that inadequate definition. It also recommends a few changes that could help remedy the existing shortcomings.

Keywords: partners' interests in the partnership, tax partnerships, partnership tax allocations

JEL Classification: D20, D21,D23, E62, H25, H26, H60, K34, M41

Suggested Citation

Borden, Bradley T., Allocations Made in Accordance with Partners' Interests in the Partnership (December 1, 2009). Business Entities, Vol. 11, p. 4, November/December 2009. Available at SSRN: https://ssrn.com/abstract=1516807

Bradley T. Borden (Contact Author)

Brooklyn Law School ( email )

250 Joralemon Street
Brooklyn, NY 11201
United States

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