Chapter 16: Partnership & LLC Tax Planning

In this section

• Special Allocations to Shift Income/Loss Gains to Advantageous Partners
  Learn how and why partnerships strategically allocate income and losses to specific partners, the substantial economic effect rules, safe harbor conditions, and common pitfalls in special allocations.
• §754 Elections & Step-Ups in Basis on Transfers & Distributions
  Discover how Section 754 elections allow partnerships to adjust inside basis when ownership transfers or certain distributions occur. Explore triggers like a partner’s death or sale and learn to track step-ups for newly admitted partners.
• Debt Reallocation & Impact on At-Risk & Passive Losses
  Explore how partnership debt arrangements influence at-risk calculations and passive loss deductions under U.S. tax law, focusing on recourse vs. nonrecourse allocations and real-world planning strategies.
• Roll-Up Strategies, Partnership Mergers & Divisions
  Learn how multiple smaller partnerships can be combined into a single entity or split apart efficiently while addressing disguised sale rules, liability reallocations, and other key tax considerations.