Ezel / IRS Rulings / 201044013

CCA 201044013: Reducing partnership liabilities can create a deemed cash distribution

Number
201044013
Outcome
Advice
Document type
Chief Counsel Advice
IRS subject
Decrease in Partner's Liabilities
Topics
Partnerships
Code sections
§ 752
Ruling dated
October 18, 2010
Publicly released
November 5, 2010
Source
View Official PDF

Apply this to your situation

This page covers legal advice the IRS Office of Chief Counsel wrote for IRS staff, issued in 2010, which can't be cited as precedent. Ask about your situation and see what the current Code and IRS guidance say, with citations.

Currency note: this determination was released in 2010
Statutory amendments, regulation changes, court decisions, or later IRS guidance may have changed the analysis since then. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, threshold, or position mentioned here.
Not precedent. Under 26 U.S.C. § 6110(k)(3), this written determination may not be used or cited as precedent. It is advice from the IRS Office of Chief Counsel to IRS personnel on the facts they presented, and identifying details were redacted by the IRS before release. The official IRS release (linked on this page as a PDF) is the authoritative source.
About this page: The plain-English summary and ruling snapshot below were written by Ezel based on the official IRS release. The full text is the IRS's own document.
View official IRS release (PDF)

Plain-English summary

Chief Counsel Advice states that reducing a partner's reported partnership liability under IRC § 752(b) results in a deemed cash distribution to the partners whose liabilities are reduced. The advice notes that the issue requires confirmation from the relevant parties.

Ruling snapshot

  • Question: What is the tax effect of reducing a partner's reported partnership liability?
  • Outcome: Advice given
  • Key authorities: IRC § 752(b)

Full text (IRS public release)

ID: CCA_2010101814121537 Number: 201044013
Release Date: 11/5/2010
Office: ----------
UILC: 752.02-00

From: -------------------
Sent: Monday, October 18, 2010 2:12:17 PM
To: --------------------
Cc: ---------------------------------
Subject: RE: New TEFRA case

I agree that adjusting the reported partnership liability of Partnership B downward results in a deemed
distribution of cash to the partners whose liabilities are decreased under section 752(b). This is -------
issue, however, so you will need their confirmation.

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