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Post by Abrams on May 22, 2009 21:34:51 GMT 4
Now You See it, Now You Don't: Exiting a Partnership and Making Gain Disappear Howard Abrams Emory University - School of Law April 7, 2009 Emory Public Law Research Paper No. 9-58 Abstract: In this Article, three methods of exiting are partnership are examined. Each exit strategy offers significant tax advantages to the nonexiting partners. In two of the exit strategies, well-known defects in Subchapter K are exploited, and I conclude that the strategies cannot be attacked successfully by the government using either the detailed rules of Subchapter K or by resort to the partnership anti-abuse rules. However, the third of the exit strategies seeks to exploit language in a treasury regulation in a manner plainly not contemplated by the drafters and which yields a result inconsistent with the structure of subchapter K. I conclude that this exit strategy can be attacked successfully by the government. The two successful strategies show that in many cases the exit of a partner can be used to defer significant amounts of income. papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID1374125_code349290.pdf?abstractid=1374125&mirid=2
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