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New Form 8308, Sales of Certain Partnership Interests: Sec 751(a) Hot Assets, Completing Parts I-IV, Non-Filing Penalties

A live 110-minute CPE webinar with interactive Q&A

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Wednesday, April 30, 2025

1:00pm-2:50pm EDT, 10:00am-11:50am PDT

Early Registration Discount Deadline, Friday, April 4, 2025

or call 1-800-926-7926
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This webinar will review the complexities of completing the recently released Form 8308, Report Sale of Exchange of Certain Partnership Interests. Our panel of federal tax reporting veterans will explain which partnerships are subject to the new reporting requirements, including the definition of a Section 751(a) exchange, outline the noncompliance penalties and penalty abatement procedures, and detail how to complete Parts I-IV.

Description

New Form 8308 is required to be filed by partnerships for sales or exchanges of partnership interests when the partnership holds Section 751(a) hot assets. Hot assets are those that would be subject to ordinary tax rates rather than capital gains treatment when realized. These include inventory and unrealized receivables. The partnership is required to file Form 8308 with its timely filed tax return and issue copies of the form to transferors and transferees.

Recently, the Treasury and IRS issued Notice 2025-2 extending the 2024 reporting deadline from the later of Jan. 31, 2025, or 30 days after the partnership is notified of the transfer, to the later of the due date or extended due date of the partnership return or 30 days after the partnership receives notification of the transfer. However, the extension is only valid if Parts I-III of Form 8308 are provided to the transferor and transferee by the original deadline and the complete Form 8308 is furnished to the same by the deadline outlined in the notice.

Part IV of Form 8308 requires reporting and categorizing the partnership and the partner's deemed gain or loss on the sale. The categories include (1) Section 751(a) gain (loss), (2) Section a1(h)(5) collectibles gain, and (3) unrecaptured Section 1250 gain.

The instructions state, "A penalty may be imposed for failing to file each Form 8308 when due, including extensions." Additional penalties apply to failure to provide Form 8308 to the transferor and transferee. A penalty of $310 per statement, up to a maximum of $1,261,000 or $2,783,000, could be imposed for failure to file. The maximum depends on whether the average gross receipts of the partnership are under $5 million for the most recent three years. Pass-through advisers need to understand the filing requirements of this new form.

Listen as our panel of partnership experts explains the new reporting requirements of Form 8308 for specific sales or exchanges of partnership ownership.

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Outline

  1. New Form 8308: introduction
  2. Filing requirements
    1. Sales and exchanges of partnership interests
    2. Section 751(a) hot assets
  3. Filing deadlines
  4. Penalties and penalty relief for noncompliance
  5. Completing Form 8308
    1. Parts I-IV
    2. Examples of common scenarios

Benefits

The panel will review these and other critical issues:

  • Which partnerships are subject to filing New Form 8308?
  • What are the noncompliance penalties associated with this form?
  • How to complete Parts I-IV of Form 8308
  • What are Section 751(a) hot assets?

Faculty

Alfonsi, John
John T. Alfonsi, CPA
Managing Director
Cendrowski Corporate Advisors

Mr. Alfonsi has 25 years of tax consulting, business valuation, litigation support and forensic accounting experience....  |  Read More

Desalvo, Phillip
Phillip W. Desalvo
Principal
KPMG

Mr. Desalvo is a Principal in KPMG’s National M&A Tax practice and is based in the firm’s Chicago...  |  Read More

Nathan Massey
Nathan Massey
Senior Manager
KPMG US

Mr. Massey is a Senior Manager, Mergers and Acquisitions at KPMG US.

 |  Read More
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