September 10, 2021 2021-9016 BREAKING TAX NEWS | Senator Wyden releases discussion draft of legislative text that would change partnership rules Today, September 10, 2021, Senate Finance Committee Chair Ron Wyden (D-OR) released a discussion draft of legislative text that would revise sections of the tax code governing partnerships and a summary of those proposals. If enacted, the proposals, among other changes, would: - Mandate basis adjustments under IRC Sections 734 and 743 for partnership distributions and partnership interest sales
- Require all partnerships to use the remedial method for IRC Section 704(c) allocations
- Require partnerships to apply the partners'-interest-in-the-partnership (PIP) standard when determining partnership allocations, unless a new "consistent percentage method" applies
- Require corporate tax treatment for all publicly traded partnerships
- Generally require partnership liabilities to be allocated based on the partners' share of partnership profits
A Tax Alert is forthcoming. |