26 U.S.C. § 736
Payments to a retiring partner or a deceased partner’s successor in interest
# (a) Payments considered as distributive share or guaranteed payment
Payments made in liquidation of the interest of a retiring partner or a deceased partner shall, except as provided in subsection (b), be considered— (1) as a distributive share to the recipient of partnership income if the amount thereof is determined with regard to the income of the partnership, or (2) as a guaranteed payment described in section 707(c) if the amount thereof is determined without regard to the income of the partnership.
# (b) Payments for interest in partnership
(1) General rule Payments made in liquidation of the interest of a retiring partner or a deceased partner shall, to the extent such payments (other than payments described in paragraph (2)) are determined, under regulations prescribed by the Secretary, to be made in exchange for the interest of such partner in partnership property, be considered as a distribution by the partnership and not as a distributive share or guaranteed payment under subsection (a).
(2) Special rules For purposes of this subsection, payments in exchange for an interest in partnership property shall not include amounts paid for— (A) unrealized receivables of the partnership (as defined in section 751(c)), or (B) good will of the partnership, except to the extent that the partnership agreement provides for a payment with respect to good will.
(3) Limitation on application of paragraph (2) Paragraph (2) shall apply only if— (A) capital is not a material income-producing factor for the partnership, and (B) the retiring or deceased partner was a general partner in the partnership.
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Cited by 20
- 26 CFR § 1.1245-4 — Exceptions and limitations.
- 26 CFR § 1.1250-3 — Exceptions and limitations.
- 26 CFR § 1.1411-0 — Table of contents of provisions applicable to section 1411.
- 26 CFR § 1.1411-4 — Definition of net investment income.
- 26 CFR § 1.197-2 — Amortization of goodwill and certain other intangibles.
- 26 CFR § 1.453-9 — Gain or loss on disposition of installment obligations.
- 26 CFR § 1.469-0 — Table of contents.
- 26 CFR § 1.469-2 — Passive activity loss.
- 26 CFR § 1.691(a)-1 — Income in respect of a decedent.
- 26 CFR § 1.707-1 — Transactions between partner and partnership.
- 26 CFR § 1.708-1 — Continuation of partnership.
- 26 CFR § 1.731-1 — Extent of recognition of gain or loss on distribution.
Show 8 more
- 26 CFR § 1.736-1 — Payments to a retiring partner or a deceased partner's successor in interest.
- 26 CFR § 1.751-1 — Unrealized receivables and inventory items.
- 26 CFR § 1.753-1 — Partner receiving income in respect of decedent.
- 26 CFR § 1.771-1 — Effective date.
- 26 U.S.C. § 357 — Assumption of liability
- 26 U.S.C. § 731 — Extent of recognition of gain or loss on distribution
- 26 U.S.C. § 751 — Unrealized receivables and inventory items
- 26 U.S.C. § 753 — Partner receiving income in respect of decedent
Nearby sections (25 sections)
- 707 · Transactions between partner and partnership
- 708 · Continuation of partnership
- 709 · Treatment of organization and syndication fees
- 721 · Nonrecognition of gain or loss on contribution
- 722 · Basis of contributing partner’s interest
- 723 · Basis of property contributed to partnership
- 724 · Character of gain or loss on contributed unrealized receivables,…
- 731 · Extent of recognition of gain or loss on distribution
- 732 · Basis of distributed property other than money
- 733 · Basis of distributee partner’s interest
- 734 · Adjustment to basis of undistributed partnership property where…
- 735 · Character of gain or loss on disposition of distributed property
- 736 · Payments to a retiring partner or a deceased partner’s successor…
- 737 · Recognition of precontribution gain in case of certain…
- 741 · Recognition and character of gain or loss on sale or exchange
- 742 · Basis of transferee partner’s interest
- 743 · Special rules where section 754 election or substantial built-in…
- 751 · Unrealized receivables and inventory items
- 752 · Treatment of certain liabilities
- 753 · Partner receiving income in respect of decedent
- 754 · Manner of electing optional adjustment to basis of partnership…
- 755 · Rules for allocation of basis
- 761 · Terms defined
- 771 · Repealed. Pub. L. 114–74, title XI, § 1101(b)(1), Nov. 2, 2015,…
- 801 · Tax imposed