Mastering Tax Reporting and Planning in Real Estate Partnerships

Navigating "Dealer vs. Investor," Installment Sale Issues for Real Estate, and More

Recording of a 110-minute CPE webinar with Q&A


Conducted on Tuesday, April 26, 2016

Recorded event now available

or call 1-800-926-7926
Program Materials

This CPE webinar will provide tax advisers with a detailed and practical guide to navigating the Multistate Voluntary Disclosure Programs for noncompliant taxpayers with potential but unassessed state tax liabilities through a central point of contact. The panel will also discuss the nuances of individual states' VDPs, and outline strategies for determining whether and when to utilize a VDP to achieve favorable tax results, with a practical focus on what a company needs to do to come into full tax compliance while avoiding criminal exposure, and minimizing taxes as well as penalties and interest.

Description

Real estate partnerships often provide both tax planning/reporting complexities and opportunities that differ from other partnerships. From the very formation of the entity, form of ownership and holding purpose affect how the income, deductions, gain, and loss are characterized, allocated, and reported among various partners. Real estate partnerships carry a myriad of tax considerations, which tax advisers and compliance professionals must be able to identify to serve their LLP and LLC clients.

Among the many critical planning and reporting challenges is distinguishing between a real estate “investor” and a “dealer.” The question of whether a partnership is treated as an investor or as a dealer has significant tax implications because income recognized on the disposition of investment property can qualify for favorable long-term capital gains rates, but gain from the sale of inventory is ordinary income. Based on a facts-and-circumstances test, the investor vs. dealer distinction is frequently challenged by the IRS.

Tax advisers must understand the types of activities that jeopardize investor status and help their clients avoid those activities. They should also be familiar with strategies that help investors lock-in some capital gain if they decide to develop property that they have held for investment.

Listen as our experienced panel provides a detailed and advanced look at the complexities of real estate partnership tax reporting, and discusses some of the planning techniques available to avoid negative tax consequences when filing Form 1065.

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Outline

  1. Differences in tax law treatment between real estate partnerships owning property for development versus investment
  2. Planning structures for locking in capital gain
  3. Eligibility for installment sale treatment on sale of property by real estate partnerships prior to development
  4. Impact of mortgages on installment sale treatment

Benefits

The panel will review these and other important issues:

  • How to advise partnerships holding real estate assets to avoid “dealer” classification
  • Planning structures that help reduce the amount of gain taxed at ordinary income
  • Planning strategies for installment sales of real property prior to development

Faculty

Mark E. Wilensky
Mark E. Wilensky

Partner
Meltzer Lippe Goldstein & Breitstone

Mr. Wilensky focuses his practice on tax law, with a significant part of his practice advising clients looking to sell,...  |  Read More

Professor Bradley T. Borden
Professor Bradley T. Borden

Professor of Law
Brooklyn Law School

Professor Borden’s research, scholarship, and teaching focus on taxation of real property transactions and...  |  Read More

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