Section 754 Elections on Form 1065: Making Valid Elections, Seeking Relief For Missed or Invalid Elections

Mastering the Mechanics of Election Statements, Schedule K-1, Section 301.9100 Relief, and More

Note: CLE credit is not offered on this program

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

Conducted on Tuesday, February 2, 2021

Recorded event now available

or call 1-800-926-7926
Course Materials

This course will provide tax advisers and compliance professionals with a thorough, practical guide to the mechanics of reporting a Section 754 election on a partnership's Form 1065 return. The panel will discuss making the election and will detail available relief in instances where a partnership fails to make a timely election.

Description

The Section 754 election is complex and critical for tax advisers serving partnerships. Section 754 allows a partnership to make an election to adjust the basis of its assets under certain circumstances. The election provides for a "rebalancing" of the partnership's basis in partnership assets under Sections 734 or 743 and is an integral part of partnership tax practice.

Calculation and reporting of basis adjustments often challenge even experienced practitioners. Missed or incorrect Section 754 elections can result in costly claims against tax practitioners.

Tax compliance professionals must also grasp the mechanics of reporting an election on Form 1065 and how to obtain relief if an election is incorrect, defective, or not timely made.

Making the initial election requires an election statement, identification of partners, and calculations to document basis adjustments reported on each partner's Schedule K-1. Tax advisers seeking relief under available provisions must provide additional support for any remedy requested.

The Code and Treasury regulations contain provisions for automatic and discretionary relief in instances of missed or defective elections. There are also procedures to correct basis adjustments and request invalidation of an election.

Listen as our expert panel provides a practical guide to the tax reporting mechanics of making a Section 754 election, seeking relief for missed elections, and correcting defective elections.

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Outline

  1. Reporting timely Section 754 election
  2. Automatic relief for missed or non-timely elections under Section 301.9100-2
  3. Discretionary relief under Section 301.9100-3
  4. Remedies for correcting defective or invalid elections after the filing year
  5. Revocation of a Section 754 election

Benefits

The panel will discuss these and other important topics:

  • Documentation that must accompany a Section 754 election on a Form 1065 tax return
  • Who must sign a Section 754 election?
  • A partnership's Section 754 election absent notice from a transferee partner
  • Steps for claiming automatic relief under Section 9100
  • Seeking Section 9100 discretionary relief

Faculty

Fuller, Pamela
Pamela A. Fuller, Esq.
Counsel (Tax, M&A, International)
Zahn Law Group

Ms. Fuller’s practice has a triple focus: tax planning, tax controversies, and tax compliance. She advises a wide...  |  Read More

Standorf, Heath
Heath Standorf, CPA
Senior Manager of Tax Services
Berkowitz Pollack Brant

With nearly 15 years of experience, Mr. Standorf offers tax compliance and consulting services to high-net-worth...  |  Read More

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