(a) Partnership. The term partnership means a partnership as determined under §§ 301.7701-1, 301.7701-2, and 301.7701-3 of this chapter.
(b) Partner. The term partner means a member of a partnership.
(c) Partnership agreement. For the purposes of subchapter K, a partnership agreement includes the original agreement and any modifications thereof agreed to by all the partners or adopted in any other manner provided by the partnership agreement. Such agreement or modifications can be oral or written. A partnership agreement may be modified with respect to a particular taxable year subsequent to the close of such taxable year, but not later than the date (not including any extension of time) prescribed by law for the filing of the partnership return. As to any matter on which the partnership agreement, or any modification thereof, is silent, the provisions of local law shall be considered to constitute a part of the agreement.
(d) Liquidation of partner's interest. The term liquidation of a partner's interest means the termination of a partner's entire interest in a partnership by means of a distribution, or a series of distributions, to the partner by the partnership. A series of distributions will come within the meaning of this term whether they are made in one year or in more than one year. Where a partner's interest is to be liquidated by a series of distributions, the interest will not be considered as liquidated until the final distribution has been made. For the basis of property distributed in one liquidating distribution, or in a series of distributions in liquidation, see section 732(b). A distribution which is not in liquidation of a partner's entire interest, as defined in this paragraph, is a current distribution. Current distributions, therefore, include distributions in partial liquidation of a partner's interest, and distributions of the partner's distributive share. See paragraph (a)(1)(ii) of § 1.731-1.
(e) Distribution of partnership interest. For purposes of section 708(b)(1)(B) and § 1.708-1(b)(1)(iv), the deemed distribution of an interest in a new partnership by a partnership that terminates under section 708(b)(1)(B) is not a sale or exchange of an interest in the new partnership. However, the deemed distribution of an interest in a new partnership by a partnership that terminates under section 708(b)(1)(B) is treated as an exchange of the interest in the new partnership for purposes of section 743. This paragraph (e) applies to terminations of partnerships under section 708(b)(1)(B) occurring on or after May 9, 1997; however, this paragraph (e) may be applied to terminations occurring on or after May 9, 1996, provided that the partnership and its partners apply this paragraph (e) to the termination in a consistent manner.
[T.D. 6500, 25 FR 11814, Nov. 26, 1960, as amended by T.D. 7208, 37 FR 20686, Oct. 3, 1972; T.D. 8697, 61 FR 66588, Dec. 18, 1996; T.D. 8717, 62 FR 25501, May 9, 1997]
Notes of Decisions
Madison Gas & Elec. Co. v. Comm'r, 72 T.C. 521 (Tax Ct. 1979).
· cites it 8× “Respondent argues that the fact that the partners have elected under section 761(a) of the Code and section 1.761-1(a)(2), Income Tax Regs.”
Bussing v. Comm'r, 89 T.C. 1050 (Tax Ct. 1987).
· cites it 8× “Respondent's regulations state the term "partnership" for Federal tax purposes "includes a syndicate, group, pool, joint venture, or other unincorporated organization through or by means of which any business, financial operation, or venture is carried on.”
Antonides v. Comm'r, 91 T.C. 686 (Tax Ct. 1988).
· cites it 2× “It was on that date that petitioners joined their resources with the intent of purchasing Classmates for use in charter activities.”
McManus v. Comm'r, 65 T.C. 197 (Tax Ct. 1975).
· cites it 4× “After purchasing a tract of land, plans were submitted to the planning commission to subdivide certain property on two separate occasions.”
Elrod v. Comm'r, 87 T.C. 1046 (Tax Ct. 1986).
· cites it 2× “761-1(c), Income Tax Regs. Petitioner also responds that, although his brother and sister were entitled to receive a certain percentage of the "net profits" realized on petitioner's real estate investments, until 1977 petitioner merely reinvested any proceeds from his ventures,…”
Bussing v. Comm'r, 88 T.C. 449 (Tax Ct. 1987).
· cites it 2× “Section 761(a) defines a "partnership" broadly to include "a syndicate, group, pool, joint venture or other unincorporated organization through or by means of which any business, financial operation, or venture is carried on, and which is not, within the meaning of this title…”
Hensel Phelps Constr. Co. v. Comm'r, 74 T.C. 939 (Tax Ct. 1980).
· cites it 2× “Although this issue is difficult, we find for respondent. *108 The term "partnership," as used in the tax laws, is "broader in scope than the common law meaning of partnership, and may include groups not commonly called partnerships.”
Alhouse v. Comm'r, 62 T.C.M. 1678 (Tax Ct. 1991).
· cites it 10× “A partnership is broadly defined as "a syndicate, group, pool, joint venture, or other unincorporated organization through or by means of which any business, financial operation, or venture is carried on," which is not a corporation, trust, or estate.”
Freesen v. Comm'r, 84 T.C. 920 (Tax Ct. 1985).
· cites it 2× “1977-270 , petitioners correctly observe that if the joint venture agreements are deemed leases for section 46(e)(3) purposes, they are "strange [ones], for the 'lessee' would be required to pay 'rent' only if its use of the property resulted in net profit." The fact, however,…”
Reinberg v. Comm'r, 90 T.C. 116 (Tax Ct. 1988).
· cites it 2× “" Section 761(a) 24 defines a "partnership" broadly to include "a syndicate, group, pool, joint venture or other unincorporated organization through or by means of which any business, financial operation, or venture is carried on, and which is not, within the meaning of this…”
Dickerson v. Comm'r, 2012 T.C. Memo. 60 (Tax Ct. 2012).
· cites it 4× “The term "partnership" as defined by the Code is broader in scope than the common law meaning of partnership and may include groups not traditionally considered partnerships.”
Est. of Levine v. Comm'r, 72 T.C. 780 (Tax Ct. 1979).
· cites it 2× “Section 761(a) defines a partnership to include "a syndicate, group, pool, joint venture or other unincorporated organization through or by means of which any business, financial operation, or venture is carried on.”
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