Code Section 736: A Retiring Partner Case Study Involving Flexible Payments
by R. Zebulon Law, Esq. & Christy L. Lewis, Esq
Partners, R. Zebulon Law, Esq. and Christy L. Lewis, Esq., co-authored “Code Section 736: A Retiring Partner Case Study Involving Flexible Payments,” an article which was published in the August, 2012 edition of the Bloomberg BNA Tax Management Real Estate Journal. Their article discusses the redemption of a retiring partner’s interest in billion dollar money management partnership. The article begins with an explanation of a retiring partner’s options when “cashing out” an interest in a partnership. Specifically, the article addresses the tax implications of IRC 736, relating to payments over time in exchange for partnership interests. Most significantly, the article details the drafting considerations and tax consequences associated with structuring an agreement that includes flexible payments to the retiring partner over time.
Mr. Law and Ms. Lewis have presented the article to tax professionals across the nation and have received numerous inquiries regarding the structure of this type of planning.