Transferring closely held stock to an FLP requires careful planning

Article Abstract:

The author discusses IRS Technical Advice Memorandum 199938005 where the IRS valued close corporation stock, which had been transferred before death to a family limited partnership, at the date of death for IRC section 2036(b) estate inclusion purposes. Planning techniques are suggested which may avoid the same consequence.

Securities, Close corporations, Decedents' estates, Valuation, Closely held corporations

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Qualified nonrecourse financing and the allocation of exculpatory liabilities

Article Abstract:

This article concerns IRS Letter Ruling 199906025 which provides allocation rules for nonrecourse debt between partnership properties where the debt was an exculpatory liability recourse to the partnership entity. The debt in the ruling was considered qualified nonrecourse financing under IRC section 465. That consideration is important to the determination of deduction amounts for the at-risk rules.

Legislative Bodies, Partnerships, Finance, Laws, regulations and rules, Partnership, Nonrecourse debt, Allocation (Accounting)

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No separate interests after check-the-box

Article Abstract:

The author discusses IRS Letter Ruling 199911033 which provides rules regarding the disregard of entity status and the characterization of two-member limited liability companies as as single-member companies. The IRS applied case law regarding partnership status, and not the no separate interests test in that determination.

Limited liability companies, One-person corporations, One person corporations

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