DESCRIPTION

This IRC 754 election module discusses three events in which an IRC 754 election may be beneficial – the death of a partner, the sale of a partnership interest, and property distributions to partners. The module also addresses the mandatory negative adjustment requirement. In addition, the module demonstrates that the IRC 754 election is a timing issue. That current tax benefits from the making election will be offset by future tax detriments. And vice versa.

LEARNING OBJECTIVES

  • Discuss the general principles of making the §754 election.
  • Compare and contrast the difference between §743(b) and §734(b) adjustments.
  • Calculate the §743(b) and §734(b) adjustments and basis allocations.
  • (Optional) Calculate §743(b) and §734(b) depreciation and amortization.
  • (Optional) Discuss how intangible assets impact the §754 adjustments.

Prerequisites

4+ Years Professional Experience

Advanced Preparation

None

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