Skip to main content

Legal

Tax & Accounting

Trade & Supply

Risk & Fraud

News & Media

Books

Developers

PPCs Tax Workpapers

Computing Partner’s Basis in Property Received in Partnership Distribution

This template computes the partner’s basis in property that is distributed by the partnership in a current or liquidating distribution when multiple properties are distributed.
In a liquidating distribution or in a current distribution when the partner’s basis in his partnership interest is less than the partnership’s basis in the property distributed, follow IRC Sec. 732(c) to allocate basis to the distributed property in the partner’s hands.  This worksheet assists in the allocation of basis to the assets distributed.  If the basis of property distributed in a current distribution (plus cash distributed) is less than the partner’s basis in his partnership interest, the adjusted basis of the distributed property to the partnership carries over and becomes the basis of the property for the partner.  See PPC's 1065 Deskbook, Chapter 33.

Entering Information

All of the information needed to produce the computation is entered on the Input worksheet.  The yellow highlighted cells are calculated fields, and no data should be entered in these cells.  Any gray cells are not calculated fields, but data should not be entered in these cells.

Enter the following information:

  • Partner’s name
  • Partnership’s tax year-end
  • Basis in the partnership interest before distribution
  • Liabilities assumed by the partner (attached to the distributed property)
  • Partner’s proportionate reduction in partnership liabilities
  • Cash distributed (including marketable securities treated as money)
Complete the input table (at the bottom of the page) for each property as follows:
  • Enter a description for the property received.
  • Select a property type from the drop-down box to the right of the description.
  • Enter the following amounts:
- Fair market value
- Basis to the partnership
- Any unrecaptured IRC Sec.1245 depreciation
Computing Partner’s Basis in Property Received in Partnership Distribution