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Proposed Code §864(c)(8) Regulations Codify Tax on Gain from Sale of Partnership Interest

Volume 6 No 2    /    Read Article

By Fanny Karaman and Nina Krauthamer

Enacted as part of the Tax Cuts and Jobs Act, Code §864(c)(8) codifies the holding in Rev. Rul. 91-32 and overturns the result of the Grecian Magnesite case. In late December 2018, the I.R.S. released proposed regulations containing guidance under new Code §864(c)(8). Among the points addressed in the proposed regulations are (i) rules to compute the amount of E.C.I. gain or loss, (ii) coordination with F.I.R.P.T.A. tax and withholding, (iii) interaction with income tax treaties, and (iv) anti-abuse rules. Fanny Karaman and Nina Krauthamer discuss these and other aspects of the proposed regulations.   See more →