If the partnership agreement does not contain the provisions described in item 2 (or the provisions are not legally binding on all partners), each partner must execute a legally binding document stating that (a) the partnership is authorized and directed to elect the safe-harbor valuation rules, and (b) the partner agrees to comply with all requirements of the safe-harbor rules with respect to all partnership interests
transferred in connection with the performance of services while the election remains effective.
Under current tax law, a holder of a partnership interest
is taxed on its allocable share of the partnership's taxable income.
2036(a) did not apply, the Tax Court already had determined a discount in excess of 30 percent to reflect the lack of control and marketability inherent in Strangi's limited partnership interest
Once the assets are initially transferred to the FLP, gifts of FLP interests are then made by forms assigning partnership interests
On the deemed distribution to the original partnership's partners, assuming that each partner receiving the deemed distribution has sufficient outside basis in its partnership interest
, the distributee partners generally also will take a substituted basis in the distributed resulting partnership.
Typically, a property owner contributes its property to the umbrella partnership in exchange for partnership interests
, which are redeemable after a negotiated lock out period for shares in the REIT or cash, at the REIT's option.
The proposed regulations provide clear guidelines related to determining value by introducing a new type of partnership interest
, the Safe Harbor Partnership Interest
Because ownership interests in an LLP and an LLC are subject to limited liability, they are limited partnership interests
First, the Internal Revenue Code specifically excludes partnership interests
from tax deferral in an exchange.
2503(a) and whether a gift of a partnership interest
is itself entitled to the benefit of the annual gift tax exclusion.
After the close of the first tax year, the partnership interests
would become substantially reversed.
704(b), and revise the existing rules for determining the partners' partnership interests