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  • schedule 110 minutes

Worthlessness Deduction for Partnership Interests

Ordinary vs. Capital Losses, Abandoned vs. Worthless, Recourse vs. Nonrecourse Debt

$197.00

This course is $0 with these passes:

CPE
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About the Course

Introduction

This webinar will take a comprehensive look at the worthlessness deduction for partnership interests (including LLCs taxed as partnerships). Our panel of esteemed federal taxation veterans will review the (rather limited) available authority, contrast the worthlessness deduction with abandonment, and discuss the impact of recourse and nonrecourse debt on the worthlessness deduction. They will also discuss IRC § 165(g), which primarily applies to stock and certain bonds that become worthless during the tax years.

Description

The worthlessness deduction recently made the front page of the New York Times: "Trump may owe $100 million from double-dip tax breaks, audit shows" (New York Times, May 11, 2024) (citing panelist Prof. Walter Schwidetzky). We will examine the transaction that led to the article, whether the IRS’s position is justified, and why the worthlessness deduction may offer unique tax planning opportunities.

Listen as our panel of partnership taxation experts reviews the relevant authority and offers recommendations on calculating and deducting worthlessness deductions for partnership investors.

Credit Information

  • BARBRI is a NASBA CPE sponsor and this 110-minute webinar is accredited for 2.0 CPE credits.

  • BARBRI is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).

Date + Time

  • event

    Tuesday, July 23, 2024

  • schedule

    1:00 p.m. ET./10:00 a.m. PT

  1. Introduction
  2. Worthlessness and Abandonment deduction outside of the partnership context, law and cases
    1. How worthless and abandonment deductions differ and what makes the worthlessness deduction unique
    2. Capital versus ordinary loss treatment
    3. Impact of Debt
    4. 165(g)
    5. Pilgrim’s Pride
  3. Worthlessness and Abandonment deduction within the partnership context, law cases, and rulings
    1. Echols
    2. MCM Investment Management LLC
    3. Rev. Rul. 93-80
    4. TAM 201929019 (which in part led to the New York Times article)
    5. Practical examples
  4. Conclusion

The panel will review these and other critical issues:

  • Distinguishing abandoning an investment and a worthless partnership investment
  • Capital vs. ordinary loss treatment of investment losses
  • The impact of case law on the worthless investment deduction
  • Legislation needed to curb abuse of the worthlessness deduction

Learning Objectives

After completing this course you will be able to:

  • Identify differences between worthless investments and abandoned investments
  • Determine how case law has shaped the current state of the worthlessness deduction
  • Decide which investments qualify for a worthlessness deduction under Section 165(g)
  • Ascertain when the disposition of a partnership interest can result in an ordinary tax deduction
  • Field of Study: Taxes
  • Level of Knowledge: Intermediate
  • Advance Preparation: None
  • Teaching Method: Seminar/Lecture
  • Delivery Method: Group-Internet (via computer)
  • Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
  • Prerequisite: Three years+ business or public firm experience preparing complex tax forms and schedules, supervising other preparers or accountants. Specific knowledge and understanding of pass-through taxation, including taxation of partnerships, S corporations and their respective partners and shareholders.

BARBRI, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

BARBRI is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).

BARBRI CE webinars-powered by Barbri-are backed by our 100% unconditional money-back guarantee: If you are not satisfied with any of our products, simply let us know and get a full refund. Contact us at 1-800-926-7926 .