2016 US Code
Title 26 - Internal Revenue Code
Subtitle A - Income Taxes
Chapter 1 - Normal Taxes and Surtaxes
Subchapter K - Partners and Partnerships
Part II - Contributions, Distributions, and Transfers
Subpart B - Distributions by a Partnership
Sec. 736 - Payments to a retiring partner or a deceased partner's successor in interest
| 26 U.S.C. § 736 (2016) |
| §736. Payments to a retiring partner or a deceased partner's successor in interest |
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(a) Payments considered as distributive share or guaranteed payment
Payments made in liquidation of the interest of a retiring partner or a deceased partner shall, except as provided in subsection (b), be considered— (1) as a distributive share to the recipient of partnership income if the amount thereof is determined with regard to the income of the partnership, or (2) as a guaranteed payment described in section 707(c) if the amount thereof is determined without regard to the income of the partnership. Payments made in liquidation of the interest of a retiring partner or a deceased partner shall, to the extent such payments (other than payments described in paragraph (2)) are determined, under regulations prescribed by the Secretary, to be made in exchange for the interest of such partner in partnership property, be considered as a distribution by the partnership and not as a distributive share or guaranteed payment under subsection (a). For purposes of this subsection, payments in exchange for an interest in partnership property shall not include amounts paid for— (A) unrealized receivables of the partnership (as defined in section 751(c)), or (B) good will of the partnership, except to the extent that the partnership agreement provides for a payment with respect to good will. Paragraph (2) shall apply only if— (A) capital is not a material income-producing factor for the partnership, and (B) the retiring or deceased partner was a general partner in the partnership. |
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(Aug. 16, 1954, ch. 736, 68A Stat. 248; Pub. L. 94–455, title XIX, §1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L. 95–600, title VII, §701(u)(13)(B), Nov. 6, 1978, 92 Stat. 2918; Pub. L. 103–66, title XIII, §13262(a), (b)(2)(B), Aug. 10, 1993, 107 Stat. 541.) |
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AMENDMENTS
1993—Subsec. (b)(3). Pub. L. 103–66, §13262(a), added par. (3). Subsec. (c). Pub. L. 103–66, §13262(b)(2)(B), struck out heading and text of subsec. (c). Text read as follows: "For limitation on the tax attributable to certain gain connected with section 1248 stock, see section 751(e)." 1978—Subsec. (c). Pub. L. 95–600 added subsec. (c). 1976—Subsec. (b)(1). Pub. L. 94–455 struck out "or his delegate" after "Secretary". EFFECTIVE DATE OF 1993 AMENDMENTPub. L. 103–66, title XIII, §13262(c), Aug. 10, 1993, 107 Stat. 541, provided that: "(1) In general.—The amendments made by this section [amending this section and section 751 of this title] shall apply in the case of partners retiring or dying on or after January 5, 1993. "(2) Binding contract exception.—The amendments made by this section shall not apply to any partner retiring on or after January 5, 1993, if a written contract to purchase such partner's interest in the partnership was binding on January 4, 1993, and at all times thereafter before such purchase." EFFECTIVE DATE OF 1978 AMENDMENTAmendment by Pub. L. 95–600 applicable to transfers beginning after Oct. 9, 1975, and to sales, exchanges, and distributions taking place after Oct. 9, 1975, see section 701(u)(13)(C) of Pub. L. 95–600, set out as a note under section 751 of this title. |
| United States Code, 2012 Edition, Supplement 4, Title 26 - INTERNAL REVENUE CODE |
| Bills and Statutes |
| United States Code |
| Y 1.2/5: |
| Title 26 - INTERNAL REVENUE CODE Subtitle A - Income Taxes CHAPTER 1 - NORMAL TAXES AND SURTAXES Subchapter K - Partners and Partnerships PART II - CONTRIBUTIONS, DISTRIBUTIONS, AND TRANSFERS Subpart B - Distributions by a Partnership Sec. 736 - Payments to a retiring partner or a deceased partner's successor in interest |
| section 736 |
| 2016 |
| January 6, 2017 |
| No |
| standard |
| 90 Stat. 1834 92 Stat. 2918 107 Stat. 541 |
| Public Law 94-455, Public Law 95-600, Public Law 103-66 |
