IRS Floats New Regulations On Disguised Sales
Specifically, the proposed regulations address how reimbursements for preformation capital expenditures should be treated and how distributions that reimburse partners for the partnership's borrowing should be handled, among other issues.
A partner's property contributions to a partnership are generally tax-free, and a partnership's property contributions to a partner are generally tax-free as well. But if a transfer like this can be characterized as a sale...
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