Description
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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