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Event Information

Understanding Allocations of Partnership/LLC Debt, Income, Gain, Loss and Deductions Webcast | 4203127B CANCELED
Date: July 8, 2020
Event Start time: 8:30 AM   End time: 12:00 PM
Location: Webcast

Facility: Webcast Event


Member:       $150
Nonmember: $201

CPE Credits:

4.00 CPE: Continuing Professional Education Technical
4.00 CTEC-TX: CTEC - Federal Tax Law Hours Technical
4.00 IRS-TX: IRS Federal Tax Update Technical
3.00 MCLE: MCLE Technical


A focus on three major issues involving allocations by partnerships to partners: (1) assuring that allocations to partners will be respected under section 704(b); (2) the override provision of section 704(c) relating to the proper treatment of forward and reverse built-in gains and losses; and (3) the characterization of debt as recourse or nonrecourse and the appropriate allocation of such debt to the partner/LLC members pursuant to section 752.


  • Understand the importance of the partners' interest in the partnership test for determining whether allocations in a partnership agreement will be respected.
  • Determine whether allocations will be respected under the substantial economic effect test
  • Recognize the difference between inside basis, outside basis and capital accounts.
  • Understand the events which may result in a negative capital account and identify those partners who are allowed such a negative accout.
  • Recognize the meaning and operation of of "qualified income offset," "partnership minimum gain," "partnership nonrecourse deductions," "partner nonrecourse deductions" and "minimum gain chargeback."
  • Determine the situations where a partnership may elect to restate the book value of its assets to current fair market value and the benefits and detriments of doing so.
  • Identify the three regulatory methods for making 704(c) allocations and the operation of the ceiling rule in each.
  • Understand how partnership debt affects the outside basis of partners.
  • Distinguish between recourse debt, nonrecourse debt and qualified nonrecourse debt.
  • Determine a partner's share of partnership debt.
  • Understand the consequences of the contribution of property subject to debt and the receipt of a distribution of property subject to debt on a partner's outside basis.



Major Subjects:
  • Allocating income, gain, deductions and losses under section 704(b).
  • Understanding the Target Capital Account Method and comparing it to the Treasury 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.



Level of Difficulty:

Field of Interest:


Three years of relevant experience or an understanding partnership and LLC taxation.


Designed For:

CPAs, attorneys, tax practitioners and financial professionals.


Advanced Prep:



Event Notes:
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