AIM 6354-501

Partnership Tax
The University of Texas at Dallas
Fall 2005
(7/12/2005)

Lecturer: Ronald J. Blair, CPA, MBA

Office: SOM 4.227 MTTh 9:00–4:00
Phone: 972-883-4430 W 11:00–4:00
Email: rblair@utdallas.edu
Website: http://utdallas.edu/~rblair/
TA: Jaya
972-883-6498
jdt051000@utdallas.edu

Text: Lind, Schwarz, Lathrope, and Rosenberg, Fundamentals of Partnership

Taxation, Sixth Edition, Foundation Press, 2002 (ISBN 1-58778-221-9)
Discussion slides are based generally on the text. Other references include
McKee, Nelson & Whitmire, Federal Taxation of Partnerships and Partners, Third
Edition, Warren, Gorham & Lamont
In the frequent quotation of statute in the classnotes (slides), emphases of
certain words and phrases are added by the lecturer.
Textbooks and some other bookstore materials can be ordered online through
MBS Direct Virtual Bookstore. They are also available in UTD Bookstore and Off-
Campus Books.

Course Objective
The course will include an analysis of the IRC, Treasury Regulations, and other
authorities relating to the fundamentals of taxation of partnerships. Its purpose is to give
the student knowledge of the tax implications of this organizational form of business
operation - the effect, the advantages and disadvantages, and the pitfalls, as well as the
responsibilities that go with it. It will also give the student an introduction to the
partnership return and its purpose.

Students should read the assigned chapters, IRC sections, Regs, and prepare the weekly
assigned problems. Students are strongly urged to work the problems as assigned before
solutions are accessed. This will enable you more quickly grasp the concepts involved as
you compare your solutions to the posted solution, and will prepare you for the exam
problems as they will be very similar in content.

Students are encouraged to print a copy of each IRC section in Subchapter K for
reference throughout the semester.
Communications
E-Mail: Use WebCT to communicate with the instructor or TA. This is a closed system
and only the person to whom the message is address is allowed access. Students may
address messages to the instructor or TA privately. Or messages may be addressed to
include all other students, suc h as to raise a question that might be of interest to everyone;
responses will be made accordingly.
Discussion: The Discussion feature can be used to post messages to other members of
the class. This is an open system and all class members can access postings on it. The
instructor’s TAs do not normally respond to this feature.
Personal messages should be sent by email and not posted on the discussion board.

Grading Information:
Grading: Two tests – 20 points each 40
Final exam 25
Partnership return 20
Class participation, periodic quizzes/exercises 15
Total points 100
Exams
Two tests and a final are open book, consisting generally of problems, rules, and concepts
similar to the text problems assigned, but answered in a multiple choice format.

Class participation and quizzes

Translation of the total point score into a letter grade will be based on the instructor’s
judgment. The letter grade will reflect each student's performance relative to the course
and standards expected of graduate students at the University of Texas at Dallas.

Scholastic Dishonesty
The University has policies and discipline procedures regarding scholastic dishonesty.
Detailed information is available on Scholastic Dishonesty web page. All students are
expected to maintain a high level of responsibility with respect to academic honesty.
Students who violate University rules on scholastic dishonesty are subject to disciplinary
penalties, including the possibility of failure in the course and/or dismissal from the
University. Since such dishonesty harms the individual, all students and the integrity of
the University, policies on scholastic dishonesty will be strictly enforced.

Course Evaluation
As required by UTD academic regulations, every student needs to do an evaluation for
each enrolled course at the end of the semester. An online instructional assessment form
will be made available for your confidential use. Please look for the course evaluation
link on the course Homepage towards the finishing of the course. Your feedback and
comments are greatly appreciated

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NOTE: You MUST have a password and login ID from UTD’s Information
Resources Department in order to access databases and electronic journals. Allow
at least 24 hours to activate your computer account.

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Course Schedule
` Date Topic IRC §§ Regs §§
Partnership Tax in Brief
1 A18 Chapter 1
Overview of Taxation of Partnerships and Partners
Problems: p. 15 §§701, 7701
Building a Partnership
2 A23/25 Chapter 2
Formation of a Partnership
§§721 - 723, 704, 724
Problems: pp. 33, 40, 43, 47, 56, 70, and 72
Rules of Partnership Operations - In General
3 A30/S1 Chapter 3
Operations of a Partnership - General Rules
§§701-703, 704(d), §§1.701-1, 1.702-1(b),
705-706 1.703-1(a), 1.704-1(d)
Problems: pp. 93, 96, 100; p. 108 #1; p. 116 #1
4 S 6 Test 1 Chapters 1 - 3

Partnership Operations - Allocations

S 8 Chapter 4,
A Introduction
B Special Allocations Under §704(b)
§704(b)
Allocations (cont'd)
5 S13/15 Chapter 4,
B (cont'd)
Problems: p. 155 ##1 and 2; pp. 115, 167
C Allocations with Respect to Contributed Property
§704(a) and (c) §§1.701-3(a), 1.704-1(b)(1)
Problems: p. 189 ##1 and 2 and (2)
D Allocation of Partnership Liabilities
§§704(c)(1)(A), §§1.752-1, 1.752-2(a) - (c)
752(a) and (c)
Problems: p. 207 #1

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 Allocations (cont'd)
6 S20/22 Chapter 4,
E Allocations Where Partners Interests Vary During the Year
§703 (c)(2)(B) and (d) §1.706-1(c)(4)
Problem: p. 214 #2
F The Family Partnership Rules
§704(e) §704-1(e)(1) and (3)(i)(b)
Problems: p. 219
The Anti-Abuse Regs. - §1.701-2
Chapter
7 S27/29 10
The Partnership Anti-Abuse Regs §§1.701-2(a) - (c),
Problem: p. 391 1.702-2(e), (h) and (I)
Partner / Partnership Transactions
Chapter 5
Transactions Between Partners and Partnerships
§§707(a)(1) and (c), §§1.707-1(a) and (c),
267(a)(1) - (d), 453(g) 1.707-3(a) - (d)
Problems: p. 228; p. 234 #1; p.244 ## 1 and 2; p. 248 ##1 and 2
8 O 4 Test II Chapters 4 and 10

Partnership Return
O 6 Form 1065 Form 1065
Form 1065 Software
Partnership return problem
Partnership return due November 3
Partnership Interest Dispositions
9 O11/13 Chapter 6
Sales and Exchanges of Partnership Interests
§§705(a), 706(c ), 741, §§1.7061(c)(1) - (5),
742, 743, 751(a) - (f) 1.743-1(a) - (e),
752(a), 754, 755 1.751-1(a) and (c),
1.754-1, 1.755-1(a)
Problems: p. 266 #1, P268, p. 273, and p. 281 #1

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 Distributions - Operating
10 O18/20 Chapter 7
Operating Distributions
(Except
E) §§731, 732(a) - (d), 733, §§1.731-1(a)(1) and (3),
735, 751(a) - (d), 1.732-1(a) - (d),
§1245 1.733-1, 1.735-1,
17.735-1, 1.1245-4(f)(2)-
(3)
Problems: p. 294 ## 1 and 2, p.297 #1, p. 303, and p. 308
Liquidations / Terminations
11 O25/27 Chapter 8
Liquidating Distributions and Terminations
§§708(b)(1), 731, 732, §§1.731-1(a)(2), 1.731-2(b),
735, 751 1.731-1(b)(4)
Problems: p. 325, p. 338 #1, p. 348, p 354, p. 359, p. 370 #1
Death of a Partner
12 N 1/3 Chapter 9
Consequences of Partner's Death
§§694, 706(c ), 708(b), §§1.742-1, 1.753-1(a)
753, 1014(a) and (c ),
§2033
Problems: p. 385, p. 387 #2
Partnership return due
S Corporations
13 N8/10 Chapter 11
S Corporations and Their Shareholders
§§311(b), 1361, 1362,
1363, 1366(a) - (e),
1367, 1368, 1371,
1372, 1374, 1375,
§1378
Problems: pp. 432-433, 436-437 ##1 and 3, p. 443 #1, p. 449 #1
S Corporations (cont'd)
14 N15/17 Chapter 11
(cont'd)
Form 1065
15 N 22 Review of Partnership Return
16 N 29 Final Exam Emphasis on Chs. 5 - 9 and 11

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Syllabus Addendum
Each student in this course is expected to exercise independent scholarly
thought, expression and aptitude. This addendum to the course syllabus is
provided to assist you in developing and maintaining academic integrity
while seeking scholastic success.
General Comments:
• All academic exercises (including assignments, essays, laboratory experiments and reports,
examinations, etc.) require individual, independent work. Any exception(s) will be clearly
identified.
• Be sure your name or identifying number is on your paper.
• Complete and turn in academic exercises on time and in the required format (hardcopy, electronic,
etc.).
• Retain confirmation of document delivery if submitted electronically.
• Retain all research notes and drafts until the project or assignment has been graded.
• Obtain written authorization from your instructor prior to submitting a portion of academic work
previously submitted for any academic exercise. (This includes an individual or group project
submitted for another course or at another school.)
Essays and Significant Papers:
Be prepared
• To present periodic drafts of work in process
• To correctly and completely reference all sources of information using the citation format prescribed
• To turn your completed assignment in timely and in the prescribed manner (electronic, hardcopy, etc.)
Examinations:
Be prepared
• To leave all personal belonging at the front of the room or other designated location (this includes cell
phones, turned off of course, and beverage containers)
• To present your UTD Comet Card
• To remove your cap or hat
• To remove the batteries from any electronic device (e.g. calculator)
• To exchange blue books or bring them early as required
• To change seating
• To sign out when exiting the testing room
• To be escorted for lavatory use

All episodes of suspected scholastic dishonesty will be reported according to

University policy. Students who violate University rules on scholastic
dishonesty are subject to disciplinary penalties, including the possibility of
failure in the course and/or dismissal from the University. Since such
dishonesty harms the individual, all students and the University, policies on
scholastic dishonesty will be strictly enforced. Penalties that may be
assessed for scholastic dishonesty may be reviewed in Subchapter D.
Penalties at http://www.utdallas.edu/student/slife/chapter49.html