Description

The purpose of this course is to provide an in-depth discussion of selected advanced-level issues affecting LLCs and LLPs.

Instructor: Sue Smith, CPA

Target Audience

CPAs with clients using the LLC or LLP structure who need to understand advanced issues, problems, and planning strategies

Course Objectives

Identify tax and nontax advantages and disadvantages of LLCs and partnerships

Describe how inside and outside basis is affected by liabilities, recourse and nonrecourse

Discuss the impact of cash and property distributions

Explain the tax consequences of a sale of an interest and distinguish such consequences from the tax consequences when a partnership or LLC is acquired or merges into another LLC or partnership

Complete a case study to improve advocacy skills before the IRS

Subjects

Applicable provisions of the One Big Beautiful Bill Act (OBBBA)

Single-member limited liability companies as an alternative to subsidiaries

Cancellation of indebtedness rules and regulations

How the IRS views members or partners for Social Security purposes

Special problems when forming an LLC

Debt issues and problems in structuring LLCs and LLPs, including loan guarantee issues, recourse and nonrecourse debt, the at-risk basis rules, and new regulations restricting bottom-dollar guarantees

Distribution or a disguised sale? New regulations eliminate certain tax-deferred leveraged partnership transactions

Death or retirement of a member or partner – understanding the alternatives

Step-up in basis issues – how to make the computations and elections

Property transactions between the LLC/LLP and its members or partners – what to do with built-in gain or loss property

When are partnership losses deductible?

Material participation rules for LLC members and limited partners and how they affect passive loss issues

Continuation and termination of an LLC/partnership in the context of a merger or acquisition

Sales of an LLC interest – holding period and hot asset issues

Impact of the tax on investment income on the sale of an interest in a partnership or LLC

Repeal of the technical termination of partnership provision

Impact of Soroban Capital Partners LP, 161 TC No.12

NEW: The IRS removes recently finalized regulations identifying certain partnership basis shifting transactions as transactions of interest (see Chapter 2)

Prerequisites

A basic course in LLCs/partnerships or equivalent knowledge and experience