TAX 9900 Chapter Notes - Chapter 8: Contract, Capital Account, Maximum Exposure
Document Summary
Variation #4: assume that the mortgage is non recourse and there are no side agreements, on these facts, only the creditor, and no partner (or related party), is bearing any risk of loss. Therefore, this is a nonrecourse liability and is allocated under the rules of 1. 752 3, discussed below. Variation #5: assume the mortgage is nonrecourse, but is personally guaranteed in its entirety by b. 3. the real estate is disposed of for no consideration,37 resulting in a ,000 loss to the partnership; 4. ab"s taxable year ends and the ,000 loss must be allocated between a and b. The first loss is allocated to a and to b in accordance with the partnership agreement. These allocations have substantial economic effect and reduce the partners" respective capital accounts to zero. The remaining of the loss is a partner nonrecourse deduction which must be entirely allocated to b.
