Partnerships & Pass-Through Entities

Tax policy issues related to partnerships and pass-through entities are both political and economic as the predominant form of investment and business entity is now the limited liability company. Tax practice issues tend to track and respond to business and investment needs so as to allow the flexibility offered by partnership and Subchapter S tax rules while continuing to address perceived abuses. This policy and practice session will discuss the possible effects of tax reform on pass-through entities using a panel format. It is also intended to provide insight into current and possibly forthcoming developments of importance to practitioners and business and investment managers.

Topics to be considered may include:

• The impact of corporate compared to non-corporate tax rates on entity selection.
• Congressional consideration of large pass-through entities and forced conversion to C corporation status.
• Changes in taxation of carried interests for investment managers.
• The application of the new 3.8% Medicare investment tax on pass-through entity income allocations and gains on disposition.
• Restraints on the use of the family limited partnership for estate planning efficiency.
• Current thinking on material participation and passive loss utilization by limited liability entity members.
• Tax treatment of compensatory and non-compensatory options and convertible investments issued by pass-through entities.
• S corporation simplification.