Except as provided in subsection (b), no deduction shall be allowed under this chapter to the partnership or to any partner for any amounts paid or incurred to organize a partnership or to promote the sale of (or to sell) an interest in such partnership.
If a partnership elects the application of this subsection (in accordance with regulations prescribed by the Secretary) with respect to any organizational expenses-
In any case in which a partnership is liquidated before the end of the period to which paragraph (1)(B) applies, any deferred expenses attributable to the partnership which were not allowed as a deduction by reason of this section may be deducted to the extent allowable under section 165.
The organizational expenses to which paragraph (1) applies, are expenditures which-
26 U.S.C. § 709
AMENDMENTS2005-Subsec. (b)(1). Pub. L. 109-135 substituted "partnership" for "taxpayer" in introductory provisions and before "shall be allowed" in subpar. (A).2004-Subsec. (b). Pub. L. 108-357 substituted "Deduction" for "Amortization" in heading, added par. (2), redesignated former par. (2) as (3), and amended heading and text of par. (1) generally. Prior to amendment, text of par. (1) read as follows: "Amounts paid or incurred to organize a partnership may, at the election of the partnership (made in accordance with regulations prescribed by the Secretary), be treated as deferred expenses. Such deferred expenses shall be allowed as a deduction ratably over such period of not less than 60 months as may be selected by the partnership (beginning with the month in which the partnership begins business), or if the partnership is liquidated before the end of such 60-month period, such deferred expenses (to the extent not deducted under this section) may be deducted to the extent provided in section 165."
EFFECTIVE DATE OF 2005 AMENDMENT Amendment by Pub. L. 109-135 effective as if included in the provision of the American Jobs Creation Act of 2004, Pub. L. 108-357 to which such amendment relates, see section 403(nn) of Pub. L. 109-135 set out as a note under sectionof this title.
EFFECTIVE DATE OF 2004 AMENDMENT Amendment by Pub. L. 108-357 applicable to amounts paid or incurred after Oct. 22, 2004, see section 902(d) of Pub. L. 108-357 set out as a note under sectionof this title.
EFFECTIVE DATEPub. L. 94-455, title II, §213(f), Oct. 4, 1976, 90 Stat. 1548, as amended by Pub. L. 99-514, §2, Oct. 22, 1986, 100 Stat. 2095, provided that: "(1) IN GENERAL.-Except as otherwise provided in this subsection, the amendments made by this section [enacting this section and amending sections Internal Revenue Code of 1986 [formerly I.R.C. 1954] (as added by the amendment made by subsection (b)(1) of this section) shall apply in the case of amounts paid or incurred in taxable years beginning after December 31, 1976.", , , , and of this title] shall apply in the case of partnership taxable years beginning after December 31, 1975. "(2) SUBSECTION (e).-The amendment made by subsection (e) [amending section of this title] shall apply to liabilities incurred after December 31, 1976."(3) SECTION 709(b) OF THE CODE.-Section 709(b) of the
- Internal Revenue Code of 1986
- The term "Internal Revenue Code of 1986" means this title, and the term "Internal Revenue Code of 1939" means the Internal Revenue Code enacted February 10, 1939, as amended.
- The term "Secretary" means the Secretary of the Treasury or his delegate.
- taxable year
- The term "taxable year" means the calendar year, or the fiscal year ending during such calendar year, upon the basis of which the taxable income is computed under subtitle A. "Taxable year" means, in the case of a return made for a fractional part of a year under the provisions of subtitle A or under regulations prescribed by the Secretary, the period for which such return is made.
- The term "taxpayer" means any person subject to any internal revenue tax.