IRC Sec. 704(b): Allocations to Partners

May 10, 2011

While a partnership agreement ultimately determines a partner’s distributive share of income, gain, loss, deduction or credit, Sect. 704(b) represents the starting point to determine the validity of those allocations by a partnership or LLC treated as a partnership.

Sect. 704(b) is not easy for advisors and clients to navigate. In order for an allocation to be valid, it must meet three separate prongs of the regulations, and one of those prongs calls for passing both “economic effect” and “substantiality” tests at the end of the tax year.

Tax professionals must be able to navigate the detailed requirements of the 704(b) test work within IRS administrative guidance and associated rules on non-recourse debt, and anticipate partner allocation issues when crafting partnership agreements. This is a constantly changing area of tax policy.

Listen as our panel of tax practitioners who are experienced with Sect. 704(b) gives you thorough briefing on the current rules and relevant IRS administrative guidance.

To register, please click here.


Tuesday, May 10, 2011
1:00 pm - 2:50 pm EDT

Presenter: Amanda Wilson

Strafford Webinar