Partnership Taxation

This course introduces students to the federal taxation of partners and partnerships (including LLCs). Partnerships are the fastest-growing class of US business entity, and now account for more than one third of business profits. They are highly flexible entities that are used in a wide variety of business settings: by small businesses, by service firms, by real estate firms, as components of larger corporate entity structures, and especially throughout the finance industry by investment firms. But the rules governing partnerships are also complex, so that lawyers with a robust understanding of these rules will find themselves equipped with a valuable skill set. This course thus offers an examination of partnership taxation with an emphasis on both close reading of the code and regulations as well as practical applications in business settings. The course will cover topics including choice of business entity, lifecycle of the partnership, allocation of partnership income and losses, section 704(c) rules, sale and acquisition of partnership interests, partnership contributions and distributions, treatment of liabilities, compensation of partners and profits interests, and anti-abuse rules. The course will also discuss the role of partnerships in tax planning, the ethical considerations of tax lawyers, and policy considerations.