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 Rev 1220 as 1 07 2022

Rev 1220 as 1 07 2022-2024 Form

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in Revenue Ruling 99 - 6 situation one partner a and partner B each owned 50% of an LLC the LLC was taxed as a partnership for US tax purposes partner a sold its 50% interest in the LLC to partner B for $10,000 worth of cash after the sale a held the $10,000 worth of cash and B owned a hundred percent of the LLC as a result of the transaction the LLC converted from being a partnership to being a disregarded entity the ruling held that the treatment of the transaction to a was different than the treatment of the transaction to be a was treated as having sold a partnership interest B was treated as if first the partnership was liquidated distributing its assets to a and B and then as if B acquired the assets that were distributed to a for the cash of $10,000 the result was that B generally had a carryover basis and holding period for the portion of the assets deemed distributed to B and a cost basis for half of each of the assets that it acquired from a

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