§734. Adjustment to basis of undistributed partnership property where section 754 election or substantial basis reduction — Inbound Citations
26 U.S.C. § 734
Cited by 6 provisions in release 119-102.
Citations to 26 U.S.C. § 734 as a whole
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(E) With respect to any increase in the basis of partnership property under section 732, 734, or 743, determinations under this paragraph shall be made at the partner level and each partner shall be treated as having owned and used such partner’s proportionate share of the partnership assets.
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If a partnership files an election, in accordance with regulations prescribed by the Secretary, the basis of partnership property shall be adjusted, in the case of a distribution of property, in the manner provided in section 734 and, in the case of a transfer of a partnership interest, in the manner provided in section 743. Such an election shall apply with respect to all distributions of property by the partnership and to all transfers of interests in the partnership during the taxable year with respect to which such election was filed and all subsequent taxable years. Such election may be revoked by the partnership, subject to such limitations as may be provided by regulations prescribed by the Secretary.
Citations to §734(b)
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(a) Any increase or decrease in the adjusted basis of partnership property under section 734(b) (relating to the optional adjustment to the basis of undistributed partnership property) or section 743(b) (relating to the optional adjustment to the basis of partnership property in the case of a transfer of an interest in a partnership) shall, except as provided in subsection (b), be allocated—(1) in a manner which has the effect of reducing the difference between the fair market value and the adjusted basis of partnership properties, or(2) in any other manner permitted by regulations prescribed by the Secretary.
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(c) In making an allocation under subsection (a) of any decrease in the adjusted basis of partnership property under section 734(b)—(1) no allocation may be made to stock in a corporation (or any person related (within the meaning of sections 267(b) and 707(b)(1)) to such corporation) which is a partner in the partnership, and(2) any amount not allocable to stock by reason of paragraph (1) shall be allocated under subsection (a) to other partnership property.Gain shall be recognized to the partnership to the extent that the amount required to be allocated under paragraph (2) to other partnership property exceeds the aggregate adjusted basis of such other property immediately before the allocation required by paragraph (2).
Citations to §734(d)
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(2) The Secretary shall prescribe such regulations as may be appropriate to carry out the purposes of paragraph (1) and section 734(d), including regulations aggregating related partnerships and disregarding property acquired by the partnership in an attempt to avoid such purposes.