(a) General rule.— The adjusted basis of a partner’s interest in a partnership shall be the basis of such interest determined under § 30342 of this title (relating to contributions to a partnership) or § 30362 of this title (relating to transfers of partnership interests)—(1) Increased by the sum of his/her distributive share for the taxable year and prior taxable years of:(A) Taxable income of the partnership as determined under § 30333 of this title;(B) income of the partnership exempt from tax under this part, or under the provisions of any other law that grants total or partial tax exemption with respect to income derived from its operations, and(C) the amount of the deductions of agricultural income granted by § 30132 of this title; and(2) Decreased (but not below zero) by distributions by the partnership as provided in § 30353 of this title and by the sum of his/her distributive share for the taxable year and prior taxable years of:(A) Losses of the partnership, and(B) The amount of credits allowed under § 6013 of Title 23, § 6344(a) of Title 23, or from any other law granting similar credits.(C) The withholdings at source of §§ 30280 and 30274 of this title; and(D)

he amount of credits allowed under § 6013 of Title 23, § 6344(a) of Title 23, or from any other law granting similar credits.(C) The withholdings at source of §§ 30280 and 30274 of this title; and(D) expenditures of the partnership not deductible in computing its net income and not properly chargeable to capital account. History —Jan. 31, 2011, No. 1, § 1071.05, retroactive to Jan. 1, 2011; Dec. 10, 2011, No. 232, § 86.