This webinar is presented by CalCPA.
CPE Credits: CPE 2.00, MCLE 2.00, IRS-TX 2.00, CTEC-TX 2.00
Partnerships are an important part of United States tax administration and a major tax planning vehicle. This Webinar is the second in a four-part series that will be a valuable introductory course on the partnership lifecycle. For experienced tax professionals seeking to grow their skills, this course will also be useful as a refresher course to partnership mechanics. This Webinar reviews the tax treatment of partnership allocations of tax items between or among the partners in the partnership. Learn how partnership allocations fit within the structure of Subchapter K of the internal revenue code. Understand when partnership allocations will be respected under federal law, and recognize when taxing authorities may force a reallocation. Course topics include: nature of partnership allocations (mandatory or discretionary), overview on federal tax law limitations on allocations (Section 704 Regulations), determining whether an allocation has substantial economic effect, relevance of capital accounts, financial statements, and book-tax adjustments in accounting for partnership allocations, and introduction to certain special allocations, including targeted allocations. This course does not cover partnership contribution transactions in general and nonrecognition transactions, which were covered in the first Webinar of the series. It also does not cover partner-level limitations. Basis transactions and liquidation, redemption, and distribution transactions will be discussed later in the Webinar series.
Identify and distinguish partnership allocations from partnership distributions
Determine whether a partnership allocation is mandatory or discretionary
Determine how partnership contributions of property will be treated under Section 704 Regulations under different allowable methods
Recognize relevant considerations for substantial economic effect and apply tests in analyzing whether partnership allocation will be respected.
Apply a general understanding of differences between generally accepted accounting principles, general tax principles, and Section 704 rules in determining meaning of partnership allocations of profit and loss.
Identify special allocations and understand how they operate.
Review Section 704 limitations on partnership allocations.
Highlight relevant issues concerning partnership allocations and when they are subject to reallocations.
Discuss book-tax relationship and operation of book-tax rules in making partnership adjustments.