This advanced course examines the federal tax consequences of business dissolutions, ownership changes, and related restructuring transactions involving partnerships, S corporations, and closely held businesses. Using a cradle-to-grave framework, the program addresses planning, execution, valuation, reporting, and post-transaction compliance issues arising in sales, redemptions, liquidations, divorces, deaths, and internal restructurings. Participants will analyze inside and outside basis, debt basis, §754 adjustments, § 302 redemption tests, § 1041 transfers, F reorganizations, § 751 hot assets, and the treatment of goodwill and other § 197 intangibles.
The course also incorporates practical guidance on NIIT, potential § 1202 considerations, final-year return procedures, and selected state tax issues that commonly affect business exits and ownership transitions.

Learning Objectives

• Distinguish the tax treatment of business exits and ownership changes for partnerships, S corporations, and shareholders or partners at both the entity and owner levels.

• Compute and reconcile inside basis, outside basis, and S corporation stock and debt basis in liquidation, sale, redemption, and restructuring contexts.

• Determine when partnership distributions and liquidations qualify for nonrecognition treatment and when gain or loss must be recognized.

• Analyze S corporation liquidations under §336 and §331, including the effect of deemed asset sales and pass-through gain or loss.

• Identify and apply the §302 tests to determine whether a redemption receives sale or exchange treatment or dividend/distribution treatment.

• Evaluate the impact of §751 hot assets, §754 elections, and basis step-up opportunities in transfers of partnership interests.

• Assess the tax consequences of transfers incident to divorce under §1041 and identify limitations relating to suspended losses and carryover basis.

• Recognize planning opportunities and limitations involving F reorganizations, § 197 intangibles, and potential §1202 considerations.

• Evaluate whether gains from ownership changes or liquidations may be subject to §1411 net investment income tax.

• Identify key federal and state compliance steps in the final year of an entity’s existence or after a significant ownership transition, including final returns, dissolution filings, and related administrative requirements.

• Apply valuation principles relevant to closely held business interests, including discounts, buy-sell agreements, and § 2703 considerations.

Major Topics

Planning the Exit or Ownership Change

• Choice of entity structure

• Asset sale vs. equity sale vs. redemption vs. liquidation

• Buy-sell agreement design and valuation implications

Core Basis Architecture

• Inside vs. outside basis

• Partnership liability allocations under §752

• S corporation stock basis and debt basis limitations

Sales and Transfers of Ownership Interests

• Partnership interest sales and §751 hot assets

• S corporation stock sales

• Death, §1014 basis adjustments, and successor-owner issues

• Potential §1202 considerations where relevant

Liquidations and Dissolutions

• Partnership liquidating distributions under §731, §732, and §736

• S corporation liquidations under §336 and §331

• Treatment of cash, property, liabilities, and built-in gain or loss

Redemptions and Internal Ownership Shifts

• § 302 tests

• § 301 fallback treatment

• Cross-purchase vs. redemption economics and tax consequences

Restructuring and Entity Modernization

• F reorganizations

• D reorganizations

• Pre-sale and post-sale restructuring considerations

• Basis and attribute preservation issues

Special Situations

• Transfers incident to divorce under §1041

• Goodwill and Section 197 intangibles

• Family and related-party complications

Ancillary Tax Consequences

• § 1411 NIIT

• Valuation of closely held interests & Rev. Rule 59-60 principles

• §2703 and Buy-Sell Agreements

• State tax nexus and dissolution-related state filings

Final-Year Reporting and Compliance

• Final Forms 1065 and 1120-S

• Form 966 and related dissolution filings

• EIN deactivation and administrative wrap-up

• Practical reporting checklists

To complete this course participants need to: Answer polling questions to meet NASBA / IRS / State Board of Accountancies requirements for attendance verification.

A course evaluation form is provided for your feedback. Participants have 1 year from the date of purchase/enrollment to complete this course.

Our Refund policy can be found at: https://cpeprime.com/cancellation-and-refund/

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