Structuring Redemptions of Partnership and LLC Interests: Issues Unique to Liquidating Distributions
IRC 754 Elections, Section 736(b) Payments, Character and Timing of Gain, Installment Sales, and More
Recording of a 90-minute premium CLE/CPE video webinar with Q&A
This CLE/CPE course will provide tax counsel and advisers with specific and practical guidance in navigating the tax rules that apply to the redemption of LLC or partnership interests. The panel will discuss common pitfalls and uncertainties under current tax law and outline best practices for structuring transactions.
Outline
- Redemption transactions and Section 736(b) payments
- Treatment of Section 751 "hot assets" in redemption transactions
- Section 736(a) payments to general partners
- Installment sale treatment of partnership redemptions
- Liquidating distributions of property rather than cash
- Section 754 elections in effect or not in effect
- Stuffing allocations before redemption
- Disguised sale risks
Benefits
The panel will review these and other challenging issues:
- Distinguishing between redemption and a sale of a partnership interest by the redeeming partner to another partner(s)
- Under what circumstances would a redemption be disadvantageous to the partnership or the remaining partners?
- How do the basis adjustment rules that apply when a Section 754 election is in effect function in redemption as opposed to a sale of a partnership interest?
- Applying the Section 751 "hot asset" rules to the redeeming partner
- Differences in the character of gain or loss between redemption and other sale transactions
- Filing considerations when a partner is redeemed
- How Section 736(b) applies to payments to the redeeming partner
- Treatment of distributions of partnership property (including cash) and deemed cash distributions arising from a reduction in partnership liability allocations under Section 752
Faculty
Alan M. Blecher, JD
Managing Director
CBIZ Marks Paneth
Mr. Blecher has considerable experience serving high-income and high-net-worth individuals and their closely held... | Read More
Mr. Blecher has considerable experience serving high-income and high-net-worth individuals and their closely held businesses. He focuses especially on partnerships, limited liability companies and S corporations.
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Ethan R. Goldman
Partner
Davis Polk & Wardwell
Mr. Goldman advises clients on federal income tax matters related to a variety of transactions, including U.S. and... | Read More
Mr. Goldman advises clients on federal income tax matters related to a variety of transactions, including U.S. and cross-border mergers, acquisitions, joint ventures, financings, partnership investments, restructurings and spinoffs. He also regularly advises private equity sponsors and other private fund managers on tax matters relating to the formation and operation of private investment funds, as well as secondary transactions. Mr. Goldman has also represented clients in connection with tax controversy matters before the Internal Revenue Service and the U.S. Tax Court.
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Chase T. Manderino
Partner
Baker Tax Law
Mr. Manderino has over a decade of experience providing sophisticated tax guidance. Prior to joining Baker Tax Law, he... | Read More
Mr. Manderino has over a decade of experience providing sophisticated tax guidance. Prior to joining Baker Tax Law, he was most recently a tax partner at Parr Brown Gee & Loveless in Salt Lake City, Utah. Mr. Manderino provides tax and economic planning for acquisitions, dispositions, debt issuances, restructurings, as well as investment structuring. He also assists with ongoing tax planning for corporations, partnerships, LLCs, S corporations, and joint ventures.
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