American Federal Tax Report
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Federal Library
Federal Source Materials
Federal Tax Decisions
American Federal Tax Reports
American Federal Tax Reports (Prior Years)
1983
AFTR 2d Vol. 51
51 AFTR 2d 83-1268-A - 51 AFTR 2d 83-1088
COMM. v. TUFTS, ET AL., 51 AFTR 2d 83-1132 (103 S.Ct. 1826), Code Sec(s)
752; 1001; 1012, (S Ct), 05/02/1983
American Federal Tax Reports
COMM. v. TUFTS, ET AL., Cite as 51 AFTR 2d 83-1132
(103 S.Ct. 1826), Code Sec(s) 752, (S Ct), 05/02/1983
COMMISSIONER of Internal Revenue, PETITIONER v. John F. TUFTS, ET AL.,
RESPONDENTS.
Case Information:
[pg. 83-1132]
Code Sec(s):
752
Court Name:
U.S. Supreme Court, …show more content…
Lower court issue not decided on appeal: JUDICIAL PROCEEDINGS—Jurisdiction of courts and related matters—award [pg. 83-1133]of costs and attorney's fees.
Reference(s): 1983 P-H Fed. ¶38,850(1).
OPINION
Certiorari To The United States Court
Of Appeals For The Fifth Circuit.
Syllabus
Section 752(d) of the Internal Revenue Code of 1954 (IRC) provides that liabilities incurred in the sale or exchange of a partnership interest are to be treated "in the same manner as liabilities in connection with the sale or exchange of property not associated with partnerships." Under
§1001(a) of the IRC, the gain or loss from a sale or other disposition
of property is defined as the difference between "the amount realized" on the disposition and the property's adjusted basis. Section 1001(b) defines the "amount realized" as "the sum of any money received plus the fair market value of the property (other than money) received."
A general partnership formed by respondents in 1970 to construct an apartment complex entered into a $1,851,500 nonrecourse mortgage loan with a savings association. The complex was completed in 1971. Due to the partners' capital contributions to the …show more content…
83-1139]§752(c) provides that "[f]or purposes of this
section, a liability to which property is subject shall, to the extent of the fair market value of such property, be considered as a liability of the owner of the property." Section 752(c) could be read to apply to a sale or disposition of partnership property, and thus to limit the amount realized to the fair market value of the property transferred. Inconsistent with this interpretation, however, is the language of §752(d), which specifically mandates that partnership liabilities be treated "in the same manner as liabilities in connection with the sale or exchange of property not associated with partnerships." The apparent conflict of these subsections renders the facial meaning of the statute ambiguous, and therefore we must look to the statute's structure and legislative history.
Subsections (a) and (b) of §752 prescribe rules for the treatment of liabilities in transactions between a partner and his partnership, and thus for determining the partner's adjusted basis in his partnership interest. Under §704(d), a partner's distributive share of partnership losses is limited to the adjusted basis of his partnership interest.
26 U.S.C. §704(d) (1976
https://checkpoint-riag-com.lawezproxy.syr.edu/app/view/tool...
Checkpoint Contents
Federal Library
Federal Source Materials
Federal Tax Decisions
American Federal Tax Reports
American Federal Tax Reports (Prior Years)
1983
AFTR 2d Vol. 51
51 AFTR 2d 83-1268-A - 51 AFTR 2d 83-1088
COMM. v. TUFTS, ET AL., 51 AFTR 2d 83-1132 (103 S.Ct. 1826), Code Sec(s)
752; 1001; 1012, (S Ct), 05/02/1983
American Federal Tax Reports
COMM. v. TUFTS, ET AL., Cite as 51 AFTR 2d 83-1132
(103 S.Ct. 1826), Code Sec(s) 752, (S Ct), 05/02/1983
COMMISSIONER of Internal Revenue, PETITIONER v. John F. TUFTS, ET AL.,
RESPONDENTS.
Case Information:
[pg. 83-1132]
Code Sec(s):
752
Court Name:
U.S. Supreme Court, …show more content…
Lower court issue not decided on appeal: JUDICIAL PROCEEDINGS—Jurisdiction of courts and related matters—award [pg. 83-1133]of costs and attorney's fees.
Reference(s): 1983 P-H Fed. ¶38,850(1).
OPINION
Certiorari To The United States Court
Of Appeals For The Fifth Circuit.
Syllabus
Section 752(d) of the Internal Revenue Code of 1954 (IRC) provides that liabilities incurred in the sale or exchange of a partnership interest are to be treated "in the same manner as liabilities in connection with the sale or exchange of property not associated with partnerships." Under
§1001(a) of the IRC, the gain or loss from a sale or other disposition
of property is defined as the difference between "the amount realized" on the disposition and the property's adjusted basis. Section 1001(b) defines the "amount realized" as "the sum of any money received plus the fair market value of the property (other than money) received."
A general partnership formed by respondents in 1970 to construct an apartment complex entered into a $1,851,500 nonrecourse mortgage loan with a savings association. The complex was completed in 1971. Due to the partners' capital contributions to the …show more content…
83-1139]§752(c) provides that "[f]or purposes of this
section, a liability to which property is subject shall, to the extent of the fair market value of such property, be considered as a liability of the owner of the property." Section 752(c) could be read to apply to a sale or disposition of partnership property, and thus to limit the amount realized to the fair market value of the property transferred. Inconsistent with this interpretation, however, is the language of §752(d), which specifically mandates that partnership liabilities be treated "in the same manner as liabilities in connection with the sale or exchange of property not associated with partnerships." The apparent conflict of these subsections renders the facial meaning of the statute ambiguous, and therefore we must look to the statute's structure and legislative history.
Subsections (a) and (b) of §752 prescribe rules for the treatment of liabilities in transactions between a partner and his partnership, and thus for determining the partner's adjusted basis in his partnership interest. Under §704(d), a partner's distributive share of partnership losses is limited to the adjusted basis of his partnership interest.
26 U.S.C. §704(d) (1976