[Federal Register Volume 81, Number 222 (Thursday, November 17, 2016)]
[Rules and Regulations]
[Page 80994]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-27516]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[TD 9788]
RIN 1545-BM84


Liabilities Recognized as Recourse Partnership Liabilities Under 
Section 752; Correction

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final and temporary regulations; correction.

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SUMMARY: This document contains corrections to final and temporary 
regulations (TD 9788) that were published in the Federal Register on 
Wednesday, October 5, 2016 (81 FR 69282). The final and temporary 
regulations provide rules concerning how liabilities are allocated for 
purposes of section 707 of the Internal Revenue Code and when certain 
obligations are recognized for purposes of determining whether a 
liability is a recourse partnership liability under section 752.

DATES: This correction is effective November 17, 2016 and is applicable 
on and after January 3, 2017.

FOR FURTHER INFORMATION CONTACT: Caroline E. Hay or Deane M. Burke 
(202) 317-5279 (not a toll-free number).

SUPPLEMENTARY INFORMATION: 

Background

    The final and temporary regulations (TD 9788) that are the subject 
of this correction are under sections 707 and 752 of the Internal 
Revenue Code.

Need for Correction

    As published, the final and temporary regulations (TD 9788) contain 
errors that may prove to be misleading and are in need of 
clarification.

Correction of Publication

    Accordingly, the final and temporary regulations (TD 9788), that 
are the subject of FR Doc. 2016-23388, are corrected as follows:
    On page 69284, in the preamble, first column, the last sentence 
from the bottom of the first full paragraph, ``Therefore, the 707 
Temporary Regulations provide that a partner's share of a partnership 
liability for disguised sale purposes does not include any amount of 
the liability for which another partner bears the EROL for the 
partnership liability under Sec.  1.752-2.'' is corrected to read 
``Therefore, the 707 Temporary Regulations provide that for purposes of 
Sec.  1.707-5, a partner's share of a liability of a partnership, as 
defined in Sec.  1.752-1(a) (whether a recourse liability or a 
nonrecourse liability) is determined by applying the same percentage 
used to determine the partner's share of the excess nonrecourse 
liability under Sec.  1.752-3(a)(3) (as limited in its application to 
Sec.  1.707-5T(a)(2)), but such share shall not exceed the partner's 
share of the partnership liability under section 752 and applicable 
regulations (as limited in the application of Sec.  1.752-3(a)(3) to 
Sec.  1.707-5T(a)(2)).''.

Martin V. Franks,
Chief, Publications and Regulations Branch, Legal Processing Division, 
Associate Chief Counsel, (Procedure and Administration).
[FR Doc. 2016-27516 Filed 11-16-16; 8:45 am]
BILLING CODE 4830-01-P