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SHORT FORM RETURN OCR  Hacienda Gobierno

SHORT FORM RETURN OCR Hacienda Gobierno

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in Revenue Ruling 2004 - 59 a partnership converted to a corporation under state law that did not require an actual transfer of assets or interests the ruling held that for tax purposes the following steps were deemed to occur first the partnership was deemed to contribute all of its assets and liabilities to a newly formed corporation in exchange for stock in the new corporation second the partnership was deemed to liquidate distributing the stock of the new corporation to the partners in exchange for their partnership interests generally this type of conversion is tax-free however if the partnerships liabilities exceeded the tax basis of its assets gained may be recognized under Section 357 C [Music]

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