Alabama Administrative Code
Title 810 - ALABAMA DEPARTMENT OF REVENUE
Chapter 810-3-6 - GAIN OR LOSS - BASIS OF PROPERTY; ADJUSTED BASIS
Section 810-3-6-.03 - Basis In Subchapter K Entity
Universal Citation: AL Admin Code R 810-3-6-.03
Current through Register Vol. 43, No. 02, November 27, 2024
(1) For all taxable years with respect to which a preliminary assessment of income tax could be made under the provisions of § 40-2A-7, Code of Ala. 1975, as of May 27, 1997, and thereafter:
(a) Basis of property to subchapter K entity
- A subchapter K entity's basis in property contributed to it under §
40-18-8(o),Code
of Ala. 1975, by a partner or member shall be determined according to
26 U.S.C. §
723.
(b) Basis of interest in subchapter K entity
-
1. A contributing partner's or member's
initial basis in a subchapter K entity interest acquired by a contribution of
property (including money as described in §
40-18-8 [o]) to the subchapter K
entity shall be determined according to
26 U.S.C. §
722.
2. Increases and decreases to the initial
basis determined under paragraph 1 shall be made according to
26 U.S.C. §
705, and those adjustments to the initial
basis shall be determined without regard to the allocation and apportionment
rules of Section
40-18-22.
3. Special basis adjustments - The basis of
the property of the subchapter K entity shall be determined according to
26 U.S.C. §§
734 and
743, if the subchapter K entity
has in effect an election under
26 U.S.C. §
754 (relating to optional adjustment to basis
of partnership property).
(c) Basis of property distributed by
subchapter K entity - The basis of property (other than money) distributed by a
subchapter K entity to a partner or member other than in liquidation of the
partner's or member's interest shall be determined according to
26 U.S.C. §
732.
(2) No refunds shall be due or issued by reason of this regulation with respect to taxable years beginning before January 1, 1997.
(3) For interpretation of federal statutes adopted by the Alabama Legislature see Rule 810-3-1.1 -.01, Operating Rules.
Author: Ann Fondren Winborne, CPA, Nancy D. Hatfield
Statutory Authority: Code of Ala. 1975, §§ 40-2A-7(a)(5), 40-18-6.
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