Tax Notes Talk
Top Tax Cases of 2024, Part 1: Partnerships
Feb 21, 2025
In this enlightening discussion, tax experts Damien Martin and Tony Nitti from EY dive into the significant tax cases of 2024, particularly focusing on partnerships. They dissect the Denham Capital Management LP v. Commissioner and Surk LLC v. Commissioner cases, exploring the implications for IRS interpretations and partnership roles. The conversation highlights the complex relationship between general and limited partners, their tax responsibilities, and recent legislative shifts impacting asset managers. Prepare for a blend of humor, insights, and practical tax discussions!
47:48
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Quick takeaways
- The Denim Capital Management case highlights the importance of understanding state laws as limited partners may face re-evaluated self-employment tax obligations due to active management involvement.
- The CERC LLC case establishes that partners must carefully track losses against their basis, emphasizing the long-term consequences of tax liability management in partnerships.
Deep dives
Significance of 2024 Tax Cases
The discussion highlights the most impactful tax cases expected in 2024, starting with Denim Capital Management LP. This case revolves around the tax implications tied to limited partnerships and the definitions that distinguish between limited and general partners. The panel emphasizes that understanding the nuances of state laws regarding partnerships is critical, especially given that limited partners typically do not bear liability for partnership debts. The case serves as a significant point of contention for taxpayers with limited partner status who may need to reassess their self-employment tax obligations.
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