Section 704 B Book

704 b basis will be booked up to 282 resulting in a 180 282 fmv less 102 sec.

Section 704 b book. Just the accounting for certain items. 704 b book and tax purposes of 102 and 30 respectively and its sec. Secondly these books are used to identify the economic substance of the deal.

17041 704 1 b 2 iv g 3 book amortization is the same ratio as the tax amortizationbook amortization is the same ratio as the tax amortization the. Therefore at that time the equipment has a net book value for sec. Gaap books on the other hand are required to be maintained in order to.

Section 1 704 1 b 2 iv g provides that to the extent a partnership s property is reflected on the books of the partnership at a book value that differs from the adjusted tax basis the substantial economic effect requirements apply to the allocations of book items. Section 704 b of the internal revenue code provides that a partner s distributive share of income gain loss deduction or credit is determined in accordance with the partner s interest in the partnership if the partnership agreement does not provide as to the partner s distributive shares of these items or the allocation to a partner of. Section 465 a of such code as amended by this section shall not apply with respect to partnership liabilities to which the last 2 sentences of section 704 d of such code as in effect on the day before the date of enactment of this act did not apply because of the provisions of section 213 f 2 of the tax reform act of 1976 set out as a.

Section 704 b books are required to be maintained because it is generally required by the tax law but you are not required to show these books on the partnership s tax return balance. Section 1 704 1 b 2 iv f 4 you would see that after a revaluation the partners shares of gain or loss as computed for tax purposes must take into account the. It is not a set of books on this basis.

Section 704 c and 1 704 1 b 4 i govern the partners distributive. If you were to look at reg. Reasons for maintaining gaap books and section 704 b the reason for maintaining section 704 b is because the tax law generally demands it even though one is not expected to show these books on the balance of the partnership s tax return.

704 b book basis built in gain for layer 2.