30575

(a) General rule. — Payments made to a retiring partner or the successors of a deceased partner shall be considered:(1) As a distributive share to the recipient of special partnership income, if the amount thereof is determined with regard to the special partnership’s income, or(2) as a secured payment, if the amount is determined without regard to the special partnership’s income.(b) The Secretary shall determine by regulations the circumstances in which such payments shall be treated as a distribution by the special partnership in exchange for the interest of such partner and not as a distributive share or secured payments under subsection (a). History —Jan. 31, 2011, No. 1, § 1114.25, retroactive to Jan. 1, 2011.