Allocating Partnership/LLC Income, Losses and Debt to Partners Webinar

• Understand the impact of the Tax Cuts and Jobs Act on partnership reporting to partners and related strategies.
• Recognize the difference between book and tax basis capital accounts.
• Recognize the Treasury Capital Account Method of allocating income, gains, losses, and deductions under section 704(b).
• Determine when the partnership agreement enables a partner to meet the safe harbor for economic effect.
• Identify the strengths and weaknesses of the Target Capital Account Method.
• Determine when an LLC member or Limited Partner can have a negative capital account.
• Recognize terminology in partnership agreements such as “partnership minimum gain," “partner minimum gain," “partnership nonrecourse deductions” and “partner nonrecourse deductions."
• Recognize and understand the importance of a “minimum gain chargeback” and a “qualified income offset” in a partnership agreement.
• Determine when capital accounts can be optionally revalued and why it matters.
• Identify the “ceiling rule” and the three regulatory methods of making section 704(c) allocations.
• Distinguish recourse debt from nonrecourse debt, and qualified nonrecourse financing.
• Recognize the definition of a “bottom-dollar payment obligation” and why it matters.
• Determine how to properly report each partner’s debt share on IRS Schedule K-1.
• Recognize the competing strategies that arise when partners contribute cash, appreciated property or services to a partnership.

• Allocating income, gain, deductions and losses under section 704(b).
• Distinguishing the Treasury Capital Account Method from the Target Capital Account Method.
• Allocations of built-in gain or loss pursuant to section 704(c).
• Properly characterizing debt as recourse, nonrecourse, or qualified nonrecourse financing.
• Allocating debt to the partners pursuant to section 752.