Tax Issues in Transferring LLC and Partnership Interests

This CLE/CPE course will provide tax counsel and advisers with an overview of the tax rules that apply to the sale or transfer of an LLC or partnership interest. The panel will discuss common pitfalls and uncertainties in the tax code and outline best practices to structure transactions.

For the unwary and unprepared, the tax treatment of LLCs and partnerships is fraught with confusion and problems. Ownership interests in these entities are comparable to corporate shares, but there are many important distinctions. Different rules determine tax basis, holding periods, and the character of gain or loss.

Evaluating the tax consequences of a sale or disposition of an LLC or partnership interest often requires considering whether the transferring interest is a profits interest or a capital interest, whether the interest is subject to vesting, and the character and holding period of the assets held by the partnership. To avoid unfavorable tax consequences, tax counsel must know how to evaluate tax treatment of LLC and partnership interest transfers.

Listen as our panel of experienced tax attorneys examines the complex tax rules for transferring LLC and partnership interests and best practices for structuring transactions to obtain desired tax outcomes.