Changes in Partners’ Interest and Transfers of Capital input have been redesigned, effectively combining both aspects of the transaction. Separate input for transfer of capital on
The System can accommodate as many as a hundred separate transfer periods involving as many partners as may be changing their interests in the partnership at that date. As in prior years, no information needs to be entered for those partners who are not changing their percentage ownership in the partnership. A partner can transfer his entire interest in one period and then reenter the partnership in a later period by receiving a share in the partnership.
Note that the input begins with the date the transfer occurred. Then enter the resulting percentage of units for the transferring and receiving partners. This is the percentage interest in the partnership that the partner will have after the transfer. If a partner transfers its entire interest, this would be entered as -0-. If a partner with a 10 percent interest in the partnership transfers half his interest to other partners, his resulting percentage would be entered as .05 and under Transfer Information – Percentage / units, also enter .05, since that is the interest in the partnership being transferred to the other partners. The code "T" is used to indicate a transferring partner and the partner number under Transfer Information is left blank.
The input is much the same for receiving partners who are designated with a code "R." To link the receiving partner to the transferring partner, enter the transferring partner’s number under Transfer Information – Partner number. The resulting percentage for the receiving partner is his percentage in the partnership before the transfer increased by the percentage in the partnership that was transferred to him. Therefore, if the partner had a ten percent interest in the partnership before the transfer and an additional ten percent interest is transferred to him, the resulting percentage would be twenty percent entered as .20. The 10 percent interest in the partnership transferred to him would be entered under Transfer Information / Percentage / Units, as .10.
If a partner is receiving transfers from more than one transferring partner, enter the resulting percentage from all transfers to that partner plus his original percentage interest as the Resulting Percentage/Unit. Then use as many rows as necessary with codes “R,” the transferring partner’s number and the Percentage / Units transferred under the Transfer Information for each transfer.
Under this new input scheme it is permitted to have a partner both making transfers to other partners as well as receiving transfers from other partners either between periods or within a given period. However, the Resulting Percentage / Units can only be entered once per partner, per period, and must be the net of the partner’s prior percentage interest in the partnership net of any transfers affecting that partner during the period.
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