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KPMG report: Sale of partnership interests resulting in ordinary income

KPMG report: Sale of partnership interests

Partners selling interests in partnerships with “hot assets”—including certain non-cancellable service contracts—may recognize ordinary income.

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The IRS recently argued in a court case that gain from the sale of a management company was predominately ordinary income because the majority of the company’s value related to service contracts. 

Read a November 2019 report [PDF 128 KB]: What’s News in Tax: Customer Value May Result in Ordinary Income from the Sale of Partnership Interests

This report explains the potential significance of the IRS challenge and the importance of identifying customer value in connection with the sale of partnership interests. 

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