U.S. Partnerships

Form 8804 Will Apply Tax Rates in Effect in 2012 to Fiscal Year Partnerships in 2013 (Ann. 2013-30)

Posted on 04/25/2013 by CCH

Wade Wilson, CPA

On May 1, 2012 Governer Deal signed into law, House Bill 965 changing the withholding requirements on nonresidents effective for tax years beginning on or after January 1, 2012.  Previously, Georgia allowed withholding on distributions paid or credited to partners who are nonresidents of Georgia (including nonresident alien partners).  The law has been modified so that withholding is now determined based on the partner's share on taxable income sourced to the state.  The withholding tax rate is still 4 percent.

CCH

In a recent Tax Court Memorandum, the court ruled that a gift of a limited partnership interest would qualify for the annual exclusion.

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Situation

A Real Estate Fund, which had invested in several properties in New York and California, was in the process of liquidating. The partnership consisted of approximately 4000 taxable and
tax-exempt partners. Because the Fund was liquidating, they needed high quality tax services, while facing cost reductions and staff shortages.