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were included in the reported amount realized of $4.8 million,
and then distributed to petitioner. On the Coastal side of the
transaction, there's a disparity in the book and tax treatments
of petitioner's participation in Coastal: Coastal recorded on
its books a contribution to capital by petitioner in the amount
of $700,000; on Coastal's tax balance sheet reconciliation of
partners' capital accounts, petitioner is shown as having made no
capital contribution. This disparity is reflected in Coastal's
book and tax accounting for the receipt of the Mall, which was
booked at a value that exceeds its tax basis by approximately the
same amount as the equivalent amounts of the credits and
petitioner's capital contribution.
It's the tax treatment of the credits, at both the Pecaris
partnership and partner levels, over which the parties part
company.
A. Amount of Pecaris Gain
1(a) Amount Realized
Having opened up the transaction for review, we must first
determine the amount of the Pecaris gain on its sale of the Mall
to Coastal. Under section 1001(a) "The gain from the sale or
other disposition of property shall be the excess of the amount
realized therefrom over the adjusted basis" of the property.
Under section 1001(b), "The amount realized * * * shall be the
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