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Subsection (c) makes clear that, whenever the gross
income of a partner is to be determined, such amount shall
include his distributive share of the partnership gross
income. For example, a partner is required to include his
distributive share of partnership gross income in
determining his individual gross income for the purposes of
determining the necessity of filing a return, the
application of the provision permitting the spreading of
income for services rendered over a 3-year period, the
amount of gross income received from possessions of the
United States, and whether the extended period of limitation
provided in the case of 25-percent omission from gross
income is applicable. [Emphasis added.]
The Finance Committee report, S. Rept. 83-1622, supra at 378, is
almost identical, and does not even note that the Finance
Committee proposed to amend section 702(c) by applying it to
determinations “for purposes of this title” (i.e., the entire
Internal Revenue Code), while the House would have applied
section 702(c) to determinations “for purposes of this chapter”
(i.e., chapter 1, relating to income taxes). The statute of
limitations is in chapter 66, not chapter 1. The Senate version
was enacted. See H. Rept. (Conf. Rept.) 83-2543, at 14 (1954),
relating to Senate Amendment 177.
In 1956, the Treasury Department promulgated regulations
(T.D. 6175, 1956-1 C.B. 211, 214-216) dealing with the extended
limitations period, as follows:
Sec. 1.702-1. Income and credits of partner.--
* * * * * * *
(c) Gross income of a partner.--
* * * * * * *
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