Special Commentary: State Tax Treatment of Investment Partnerships 

July, 2022 - Kelvin M. Lawrence

Dinsmore partner Kelvin Lawrence was published in Bloomberg Tax with his article "Special Commentary: State Tax Treatment of Investment Partnerships." Read an excerpt below.



The Multistate Tax Commission has undertaken an ambitious project on the state taxation of partnerships. Their partnership work group consists of volunteers from numerous state revenue departments, with the able assistance of MTC Counsel Helen Hecht and Chris Barber. Its first milestone was developing an outline that divided the work group’s charge into four groups of issues: taxation of partnership income and items; taxation of gain (loss) from the sale of a partnership interest; entity-level tax issues; and administration and enforcement.


The first subject MTC staff chose and the work group endorsed for detailed analysis was “the trillions of dollars flowing through investment partnerships.” MTC staff prepared an extensive white paper, State Tax Treatment of Investment Partnerships, which is useful reading to understand the depth and breadth of the issues. Section II.B. indicates that investment partnerships, broadly defined as the finance and holding company industry segment, accounted for 70% of all reported partnership income during the years studied, making the case for why investment partnerships and their partners should be analyzed first.



Read the full article here.


 



Link to article

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