BarbriSFCourseDetails

Course Details

This CLE/CPE course will provide tax professionals with comprehensive guidance on recent IRS focus on abusive basis-adjustments transactions and navigating applicable tax rules and IRS examinations. The panel will discuss the potential application of the rules and proposed regulations, IRS challenges to surrounding basis adjustments, Notice 2024-54 and forthcoming regulations addressing basis-shifting transactions for partnerships and related parties, and Rev. Rul. 2024-14 and the economic substance doctrine, as well as offer practical tips to avoid costly and unanticipated tax consequences.

Faculty

Description

Determining the tax consequences of the distribution of assets by a partnership to a partner is a constant challenge for tax counsel and advisers. Section 754 provides an election allowing a partnership to adjust the basis of its assets when the partnership either distributes assets or a partner transfers an interest in the partnership. However, on June 17, the IRS released guidance specifically aimed at "basis shifting" transactions among related partners of a partnership.

The basis adjustment can have a significant impact when a partnership has an existing 754 election and admits a new partner, has one partner sell a partnership interest, or when the partnership makes a distribution to a partner. The election and adjustments can have different impacts on different partners, so tax advisers need to fully grasp the tax implications of making the election and utilizing the optional basis adjustments.

However, on June 17, 2024, the IRS and Treasury issued Notice 2024-54 (the Notice) detailing proposed regulations they intend to issue relating to certain related party partnership transactions along with specific reporting requirements. In addition, the IRS issued Rev. Rul. 2024-14 (the Revenue Ruling) that applies the economic substance doctrine to certain transactions in audits, appeals, and litigation to deny the tax benefits from certain basis-shifting transactions involving a related-party partnership. The Notice and Revenue Ruling will significantly impact tax planning for many partnerships and related parties.

Listen as our panel discusses the key issues when structuring basis adjustment transactions, Notice 2024-54 and forthcoming regulations addressing basis-shifting transactions for partnerships, Rev. Rul. 2024-14 and economic substance doctrine, and practical tips to avoid costly and unanticipated tax consequences.

Outline

  1. Structuring basis adjustment transactions
  2. Notice 2024-54
  3. Revenue Ruling 2024-14
  4. The mechanics of a Section 754 election
  5. Inside and outside basis issues
  6. Best practices in light of proposed regulations

Benefits

The panel will discuss these and other key issues:

  • Structuring basis adjustment transactions for partnerships in light of Notice 2024-54 and Rev. Rul. 2024-14
  • Understanding Notice 2024-54 special basis recovery and realization rules
  • Application of the Economic Substance Doctrine under Rev. Rul. 2024-14
  • Benefits and disadvantages of making the 754 basis election
  • Impact of the 754 election on individual partners and the partnership
  • Rules governing step-up and step-down basis adjustments
  • Rules for allocating basis adjustments
  • Common pitfalls in basis adjustments, and what practitioners can do to avoid these pitfalls

NASBA Details

Learning Objectives

After completing this course, you will be able to:

  • Understand key tax issues when structuring basis adjustment transactions in light of Notice 2024-54 and Rev. Rul. 2024-14
  • Recognize critical special basis recovery and realization rules applicable to transactions with related parties
  • Identify the basis adjustments--both mandatory and optional--that accompany a Section 754 election
  • Determine how specific basis adjustments accompanying a 754 election impact existing partners
  • Discern the ordering rules governing the allocation of basis adjustments under the election
  • Recognize the planning and strategic considerations in deciding whether to make a 754 election

  • Field of Study: Taxes
  • Level of Knowledge: Intermediate
  • Advance Preparation: None
  • Teaching Method: Seminar/Lecture
  • Delivery Method: Group-Internet (via computer)
  • Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
  • Prerequisite: Three years+ business or public firm experience at mid-level within the organization, preparing complex tax forms and schedules; supervisory authority over other preparers/accountants. Working knowledge of partnership or corporate structure, operating agreements, and shareholder agreements.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).