In the article “Pope & Talbot and a Slippery Slope: Distributions of Partnership Equity,” tax counsel Bob Kane examines certain tax considerations related to distributions of partnership equity.
This article was originally published in Tax Notes in 2021, and was selected to be included in the 2023 edition of The Corporate Tax Practice Series: Strategies for Acquisitions, Dispositions, Spin-Offs, Join Ventures, Financings, Reorganizations & Restructurings. This is Bob’s second article selected for publication in The Corporate Tax Practice Series and his third article published in a Practising Law Institute tax practice treatise.
Bob writes: “a tax advisor who performs a cursory reading of section 311 might conclude that the section 311 gain on a distribution of partnership equity is calculated based on the fair market value of the partnership equity and the corporation’s basis in the partnership equity. However, rulings issued by the IRS applying Pope & Talbot have reached a different conclusion, creating doubt about how the section 311 gain in calculated on a distribution of partnership equity.”
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