Hosted By: Strafford
William C. Lentine, partner at Warner Norcross + Judd, along with another panelist, provided tax counsel with comprehensive guidance on the 754 election for partnerships. They discussed the basis adjustment rules associated with sales, transfers and partnership interests or property distributions; reviewed the impact of the Section 754 election for individual partners and the partnership; and discussed structuring transactions to avoid unintended tax consequences.
The panel also reviewed these and other key issues:
- Mechanics of making a Section 754 election at the partnership level and understanding “inside basis” vs. “outside basis”
- Benefits and disadvantages of making the 754 basis election
- Rules governing step-up and step-down basis adjustments
- Rules for allocating basis adjustments
- Impact of the 754 election on individual partners and the partnership
- Common pitfalls in basis adjustments and what can practitioners do to avoid these pitfalls?