Sale of Partnersdhip Interest

AccTaxMan

Senior Member

Join Date: Apr 2007

Posts: 346
#1

Sale of Partnersdhip Interest

10-10-2011, 03:16 PM

Taxpayer sold his partnership interest to the other partners in 2010.

He worked in the partnership before his interest was sold. So he materially participated in the business activity.

Should the sale be reported on Schedule D or on Form 4797 in his individual tax return?

Last edited by AccTaxMan; 10-10-2011, 03:21 PM.
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BOB W

Senior Member

Join Date: Jun 2005

Posts: 4060
#2

10-10-2011, 08:58 PM

Originally posted by AccTaxMan View Post

Taxpayer sold his partnership interest to the other partners in 2010.

He worked in the partnership before his interest was sold. So he materially participated in the business activity.

Should the sale be reported on Schedule D or on Form 4797 in his individual tax return?

I would use Schedule D with his basis (cost) being his capital account. 4797 seems to apply to the sale of business assets.

This post is for discussion purposes only and should be verified with other sources before actual use.

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