Exception for Small Partnerships

ID: CCA_2010072009035737 Number: 201030034
Release Date: 7/30/2010
Office: ---
UILC: 6231.01-01
From: ---
Sent: Tuesday, July 20, 2010 9:04:02 AM
To: ---
Cc: ---
Subject: RE: QSubs: Small Partnership exception and TMP questions
I agree completely with your analysis that a Qsub, in effect a disregarded entity, constitutes a pass-thru partner and thus disqualifies the partnership from the small partnership exception to TEFRA under Rev.
Rul.2004-88. I also agree that it can be designated as TMP assuming that, at least under state law, it constitutes a separate entity. The deemed liquidation of the Qsubs when the S corp election was made should have no effect on the TMP designation both because it occurred before the TMP designation was made and because only a state law dissolution would terminate a TMP designation.