- 4 - bankruptcy estate, the contributing partners would be discharged from liability as permitted by the confirmed bankruptcy plan. Petitioner executed a contribution agreement and pursuant to its terms contributed $15,530 to the partnership’s bankruptcy estate in exchange for release of claims and potential claims of all creditors against petitioner arising out of or related to the partnership. On December 19, 1995, the bankruptcy court entered an order approving the contribution agreement. In its order, the bankruptcy court specifically discharged and released petitioner from any and all liability to the trustee and the bank arising out of or relating to the partnership, petitioner’s status as a general partner in the partnership, and the April 9, 1985, personal guaranty agreement. In addition, the bankruptcy court’s order released petitioner from “the claims or potential claims of all creditors” of the partnership. The bankruptcy court further ordered that petitioner “is subject to the jurisdiction of the Bankruptcy Court.” Tax Reporting For the 1995 tax year, the partnership issued petitioner a Schedule K-1, Partner’s Share of Income, Credits, Deductions, etc., allocating to him $405,815 of discharge of indebtedness income. Petitioners excluded $380,699 of this amount from theirPage: Previous 1 2 3 4 5 6 7 Next
Last modified: May 25, 2011