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As a practitioner, you know that sometimes small business owners make little distinction between their own pocketbook and the company’s pocketbook. For this reason, distributions from smaller partnerships can be frequent. It is important for us, as their advisors, to know what the tax impact is for these distributions – which ones will be fine, and which ones may cause a problem. Through easy-to-follow examples, we will talk about distributions front to back. We will discuss
the different types of distributions, as well as cash, property, and hybrid distributions – when you have a little bit of both!
• List the key rules of the thumb to remember when dealing with
distributions
• State the ordering rules for calculating a partner’s tax basis
• Describe the key differences between liquidating and non-
liquidating distributions
• Determine any applicable tax gains and losses of cash and
property distributions
• State the ordering rules for hybrid distributions that involve
both cash and property
• Calculate the resulting Inside Basis, Outside Basis, and IRC
704(b) Basis after both liquidating and non-liquidating
distributions
• General Rules on Distributions
• Calculation of Partnership Basis
• Non-Liquidating Distributions – Applicable IRC Code Sections
• Non-Liquidating Distributions – Examples
• Distributions of Cash & Property
• Liquidating Distributions – Applicable IRC Code Sections
• Liquidating Distributions – Examples
• Summing It Up
Tax practitioners who are looking to improve their knowledge of distributions and how they affect a partner’s tax basis
Working knowledge of fundamental partnership tax concepts
None
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