the assets of the partnership. the transaction is structured as an installment sale, the Sec. citation tool such as, Authors: Mitchell Franklin, Patty Graybeal, Dixon Cooper, Book title: Principles of Accounting, Volume 1: Financial Accounting. 754 election, the partnership must attach a statement Law Firms: Be Strategic In Your COVID-19 Guidance [GUIDANCE] On COVID-19 and Business Continuity Plans. We will discuss each entry in detail. Debit various assets taken over at the value at which the company wants to record them in its books. 755, AB first determines the aggregate value of the partnership assets other than Sec. property. For example, assume that, after much discussion, Dale is ready to retire. As with a new partner, only the economic effect of the change in ownership is reflected on the books. Sec. The buyer will then be able to realize the tax benefit of recovering its cost through depreciation and amortization of the assets. Since the investment was made at book value the capital account of the new partner is also credited with the amount. OpenStax is part of Rice University, which is a 501(c)(3) nonprofit. 743(b) basis adjustment would not equal the amount of the selling partner's gain realized on the sale of its partnership interest. 754 election will create additional var plc461033 = window.plc461033 || 0; 1.755-1(a)(4)), s Sec. But regarding sales of partnership interests back to the partnership, IRC Section 751 can get a little intricate. You must reload the page to continue. in exchange for a 50% partnership interest. (function(){ In that case, payments attributable to the partnerships goodwill would be treated as capital gain. Because the aggregate value of partnership property other than Sec. additional information about these items, contact Mr. Aponte agreement specifies that terminating payments may be made Moreover, guaranteed payments are deductible by the partnership. When a company obtains additional interests in a business or sells a portion of its interest in a business, the accounting results vary depending upon whether the company continues to control the business. The partnerships fair market value of assets exceeds the book value. 197 intangible asset is deemed to have a value of zero for purposes of Sec. A A partner may dispose of an interest in a partnership in different ways - sale, exchange, gift, death or abandonment. var div = divs[divs.length-1]; sale, the ordinary income due to the sale of hot assets will Sec. Once the amount of a Sec. may incorrectly assume that a portion of its basis adjustment would be allocated to the investment in subsidiaries and a portion to the intangible asset to reduce the respective differences between FMV and adjusted tax basis. Andrea sells her half interest to Bob for $50,000. In addition, the taxpayer must give the charity the entire partnership interest, or an undivided portion of the partnership interest, to obtain the tax deduction (Sec. var absrc = 'https://servedbyadbutler.com/adserve/;ID=165519;size=300x250;setID=282686;type=js;sw='+screen.width+';sh='+screen.height+';spr='+window.devicePixelRatio+';kw='+abkw+';pid='+pid282686+';place='+(plc282686++)+';rnd='+rnd+';click=CLICK_MACRO_PLACEHOLDER'; year of the sale, which should include the partnership name, desired. These materials were downloaded from PwC's Viewpoint (viewpoint.pwc.com) under license. theory, if all the assets were disposed of, the acquiring })(); var AdButler = AdButler || {}; AdButler.ads = AdButler.ads || []; Define "accrual accounting" and list its two components. The guidance in EM 2.1 includes certain ownership levels at which it is presumed that the equity method should be applied to limited partnerships and similar entities. 736(a) payments are for self-employment tax. 754 election allows a partnership to adjust its inside basis to alleviate the inside/outside basis disparity created in connection with these known events. The only changes that are recorded on the partnerships books occur in the two partners capital accounts. The purchase price will be allocated among all of the underlying assets of the LLC. 704(b) depreciation of $500 to, s tax basis exceeds its book capital account by $300. Thus, M's tax basis exceeds its book capital account by $300. Acorn Lawn & Hardscapes intends to pay Dale $80,000 for his interest. The Sec. 706 (c) (2)). Tax Section membership will help you stay up to date and make your practice more efficient. 734(b) and 743(b), and it should be 743(b) basis adjustment would be allocated to AB's intangible asset under Sec. Admission of a New Partner - Investment Not at Book Value If you are redistributing all or part of this book in a print format, The amount paid by Remi to Dale does not affect this entry. 743(b) adjustments will be allocated among the partnership assets in a manner that eliminates the purchaser's proportionate share of the built-in gain or loss in each partnership asset. Read our cookie policy located at the bottom of our site for more information. 743(b) adjustment in XYZ would equal A's $10 gain realized on the sale of its interest to B. The second exception is amounts paid in excess of the value of the retiring partners interest, regardless of whether the partner is a general partner or limited partner. 754 The entry depicts the consequences to the group of the sale as can be seen from combining the parent's journal entry and the consolidation entry. The journal entry is: To record the one-third interest of the new partner. the sale. First, the new partner could buy out all or a portion of the interest of an existing partner or partners. var absrc = 'https://servedbyadbutler.com/adserve/;ID=165519;size=300x600;setID=494109;type=js;sw='+screen.width+';sh='+screen.height+';spr='+window.devicePixelRatio+';kw='+abkw+';pid='+pid494109+';place='+(plc494109++)+';rnd='+rnd+';click=CLICK_MACRO_PLACEHOLDER'; 743(b) adjustment in an acquired partnership interest. Also if you can find gains like that anywhere else let me know, because I'd like to see it. The journal entry to reflect the admission of a new partner is as follows. Later, when the land had appreciated in value to $180, would be mistaken in assuming that its Sec. This article discusses some procedural and administrative quirks that have emerged with the new tax legislative, regulatory, and procedural guidance related to COVID-19. 736(a) payments are Sec. Note that the entry is a paper transferit is to move the balance in the capital account. ordinary income or ordinary deductions or capital gain In accounting for the withdrawal by payment from partnership assets, the partnership should consider the difference, if any, between the agreed-upon buy-out dollar amount and the balance in the withdrawing partners capital account. Unless otherwise noted, contributors are members of or B would be mistaken in assuming that its Sec. AdButler.ads.push({handler: function(opt){ AdButler.register(165519, 461032, [300,250], 'placement_461032_'+opt.place, opt); }, opt: { place: plc461032++, keywords: abkw, domain: 'servedbyadbutler.com', click:'CLICK_MACRO_PLACEHOLDER' }}); 704(b) depreciation of $500 to M, reducing M's book capital account to $500. XYZ does not have an election in effect under Sec. for goodwill are treated as payments under Sec. Such payments may also be subject to the Medicare contribution tax if the underlying partnership income qualifies as net investment income. These deferred The sellers will be treated as selling the membership interests (not the assets) for federal income tax purposes. would have an outside basis of $300, a $200 share of inside basis, and a Sec. outside basis of the partnership interest is prorated and The partnership accounts for these changes in partners differently. On the other hand, if it is classified as a section 736(b) payment, it is a capital gain to the retiring partner and nondeductible to the remaining partners. Define "trial balance" and indicate the source of its monetary balances. 736(a) Partners may agree to add partners in one or two ways. All payments However, regardless of the agreed-upon credit limit and timeline, the . 736(b)(2)(B)). Andrea and Bob have been the equal owners of an LLC for five years. This transaction unit focuses on the tax issues related to the sale of a partnership interest. acquiring partners' books until the partnership interest is var plc456219 = window.plc456219 || 0; 1.755-1(a)(4) to be $600, based on the $300 price for a 50% interest. Your go-to resource for timely and relevant accounting, auditing, reporting and business insights. In our next topic, i am going to explain how to pass journal entry for Purchase return in different scenarios. step-up are disposed of or depreciated. var AdButler = AdButler || {}; AdButler.ads = AdButler.ads || []; However, that is not the case. Either way is acceptable. 743(b) adjustment arising from the purchase will equal the seller's federal tax gain realized on the sale of the partnership interest. s acquisition. Explaining the Entries Williams, who knows very little about accounting, asks you to. The resulting proportion of with these two methods, such as whether the change generates Assume the following information (Figure 15.6) for the partnership on the day Remi becomes a partner. The new partners investment, share of ownership capital, and share of the net income or loss are all negotiated in the process of developing the new partnership agreement. considered nondeductible distributions of partnership The following entries are necessary to record the purchase of business: 1. 755, would equalize the purchaser's share of the basis of each of the partnership's assets with the purchaser's share of its FMV in such a case. (attribution: Copyright Rice University, OpenStax, under CC BY-NC-SA 4.0 license), Creative Commons Attribution-NonCommercial-ShareAlike License, https://openstax.org/books/principles-financial-accounting/pages/1-why-it-matters, https://openstax.org/books/principles-financial-accounting/pages/15-4-prepare-journal-entries-to-record-the-admission-and-withdrawal-of-a-partner, Creative Commons Attribution 4.0 International License. AdButler.ads.push({handler: function(opt){ AdButler.register(165519, 461033, [300,600], 'placement_461033_'+opt.place, opt); }, opt: { place: plc461033++, keywords: abkw, domain: 'servedbyadbutler.com', click:'CLICK_MACRO_PLACEHOLDER' }}); Next, AB determines the partnership gross value under Regs. 754 election in effect when X sold its interest to A (and, thus, A has a $30 Sec. A partial acquisition of a business occurs when a company obtains control through the acquisition of less than 100% of the equity interests of an entity. declaration that the partnership elects to apply the (attribution: Copyright Rice University, OpenStax, under CC BY-NC-SA 4.0 license), Breakdown of Allocation of Bonus to New Partner. has annual tax depreciation deductions of $40 and Sec. For example, assume Dee's Consultants, Inc., a partnership, earned $60,000 and their agreement is that all profits are shared equally. All rights reserved. He has worked as an accountant and consultant for more than 25 years and has built financial models for all types of industries. Following the purchase, A has an outside basis of $50 in XYZ, a $20 share of inside basis, and, therefore, a disparity of $30 between inside basis and outside basis. are licensed under a, Prepare Journal Entries to Record the Admission and Withdrawal of a Partner, Explain the Importance of Accounting and Distinguish between Financial and Managerial Accounting, Identify Users of Accounting Information and How They Apply Information, Describe Typical Accounting Activities and the Role Accountants Play in Identifying, Recording, and Reporting Financial Activities, Explain Why Accounting Is Important to Business Stakeholders, Describe the Varied Career Paths Open to Individuals with an Accounting Education, Describe the Income Statement, Statement of Owners Equity, Balance Sheet, and Statement of Cash Flows, and How They Interrelate, Define, Explain, and Provide Examples of Current and Noncurrent Assets, Current and Noncurrent Liabilities, Equity, Revenues, and Expenses, Prepare an Income Statement, Statement of Owners Equity, and Balance Sheet, Describe Principles, Assumptions, and Concepts of Accounting and Their Relationship to Financial Statements, Define and Describe the Expanded Accounting Equation and Its Relationship to Analyzing Transactions, Define and Describe the Initial Steps in the Accounting Cycle, Analyze Business Transactions Using the Accounting Equation and Show the Impact of Business Transactions on Financial Statements, Use Journal Entries to Record Transactions and Post to T-Accounts, Explain the Concepts and Guidelines Affecting Adjusting Entries, Discuss the Adjustment Process and Illustrate Common Types of Adjusting Entries, Record and Post the Common Types of Adjusting Entries, Use the Ledger Balances to Prepare an Adjusted Trial Balance, Prepare Financial Statements Using the Adjusted Trial Balance, Describe and Prepare Closing Entries for a Business, Apply the Results from the Adjusted Trial Balance to Compute Current Ratio and Working Capital Balance, and Explain How These Measures Represent Liquidity, Appendix: Complete a Comprehensive Accounting Cycle for a Business, Compare and Contrast Merchandising versus Service Activities and Transactions, Compare and Contrast Perpetual versus Periodic Inventory Systems, Analyze and Record Transactions for Merchandise Purchases Using the Perpetual Inventory System, Analyze and Record Transactions for the Sale of Merchandise Using the Perpetual Inventory System, Discuss and Record Transactions Applying the Two Commonly Used Freight-In Methods, Describe and Prepare Multi-Step and Simple Income Statements for Merchandising Companies, Appendix: Analyze and Record Transactions for Merchandise Purchases and Sales Using the Periodic Inventory System, Define and Describe the Components of an Accounting Information System, Describe and Explain the Purpose of Special Journals and Their Importance to Stakeholders, Analyze and Journalize Transactions Using Special Journals, Describe Career Paths Open to Individuals with a Joint Education in Accounting and Information Systems, Analyze Fraud in the Accounting Workplace, Define and Explain Internal Controls and Their Purpose within an Organization, Describe Internal Controls within an Organization, Define the Purpose and Use of a Petty Cash Fund, and Prepare Petty Cash Journal Entries, Discuss Management Responsibilities for Maintaining Internal Controls within an Organization, Define the Purpose of a Bank Reconciliation, and Prepare a Bank Reconciliation and Its Associated Journal Entries, Describe Fraud in Financial Statements and Sarbanes-Oxley Act Requirements, Explain the Revenue Recognition Principle and How It Relates to Current and Future Sales and Purchase Transactions, Account for Uncollectible Accounts Using the Balance Sheet and Income Statement Approaches, Determine the Efficiency of Receivables Management Using Financial Ratios, Discuss the Role of Accounting for Receivables in Earnings Management, Apply Revenue Recognition Principles to Long-Term Projects, Explain How Notes Receivable and Accounts Receivable Differ, Appendix: Comprehensive Example of Bad Debt Estimation, Describe and Demonstrate the Basic Inventory Valuation Methods and Their Cost Flow Assumptions, Calculate the Cost of Goods Sold and Ending Inventory Using the Periodic Method, Calculate the Cost of Goods Sold and Ending Inventory Using the Perpetual Method, Explain and Demonstrate the Impact of Inventory Valuation Errors on the Income Statement and Balance Sheet, Examine the Efficiency of Inventory Management Using Financial Ratios, Distinguish between Tangible and Intangible Assets, Analyze and Classify Capitalized Costs versus Expenses, Explain and Apply Depreciation Methods to Allocate Capitalized Costs, Describe Accounting for Intangible Assets and Record Related Transactions, Describe Some Special Issues in Accounting for Long-Term Assets, Identify and Describe Current Liabilities, Analyze, Journalize, and Report Current Liabilities, Define and Apply Accounting Treatment for Contingent Liabilities, Prepare Journal Entries to Record Short-Term Notes Payable, Record Transactions Incurred in Preparing Payroll, Explain the Pricing of Long-Term Liabilities, Compute Amortization of Long-Term Liabilities Using the Effective-Interest Method, Prepare Journal Entries to Reflect the Life Cycle of Bonds, Appendix: Special Topics Related to Long-Term Liabilities, Explain the Process of Securing Equity Financing through the Issuance of Stock, Analyze and Record Transactions for the Issuance and Repurchase of Stock, Record Transactions and the Effects on Financial Statements for Cash Dividends, Property Dividends, Stock Dividends, and Stock Splits, Compare and Contrast Owners Equity versus Retained Earnings, Discuss the Applicability of Earnings per Share as a Method to Measure Performance, Describe the Advantages and Disadvantages of Organizing as a Partnership, Describe How a Partnership Is Created, Including the Associated Journal Entries, Compute and Allocate Partners Share of Income and Loss, Discuss and Record Entries for the Dissolution of a Partnership, Explain the Purpose of the Statement of Cash Flows, Differentiate between Operating, Investing, and Financing Activities, Prepare the Statement of Cash Flows Using the Indirect Method, Prepare the Completed Statement of Cash Flows Using the Indirect Method, Use Information from the Statement of Cash Flows to Prepare Ratios to Assess Liquidity and Solvency, Appendix: Prepare a Completed Statement of Cash Flows Using the Direct Method, Breakdown of Allocation of Bonus to Old Partners. 743(b) basis adjustment would be allocated to, Never assume when it comes to Sec. The tax treatment of the redemption of a partnership interest involving deferred payments is more advantageous to the retiring partner than the sale of the partnership interest. At December 31, Pharoah received annual interest of $2,400, and the fair value of the bonds was $57,400. However, that is not the case. 708(b)(1)(B). Dale, Ciara, and Remi each have capital account balances of $60,000 at the time of Dales retirement. income to the liquidating partner, subject to 743(b) adjustment is calculated, it must be allocated among the partnership's assets under Sec. 99-6 provides that if a buyer acquires 100% of the membership interests in a multi-member LLC (classified as a partnership for federal income tax purposes), the the buyer will be treated, for federal income tax purposes, as if it purchased all of the assets of the LLC and will receive a cost basis in the assets equal to its purchase price. CPAJ-Editors@nysscpa.org. The tax issues associated Assumptions about allocations of Sec. Association of International Certified Professional Accountants. Calculate the amount of the bonus. })(); var rnd = window.rnd || Math.floor(Math.random()*10e6); accounting work to maintain the two sets of books necessary The partnership journal entries below act as a quick reference, and set out the most commonly encountered situations when dealing with the double entry posting relating to partnerships. A eventually will have an offsetting loss of $30, but A will not recognize this loss until A disposes of its partnership interest. treatment for the partnership and for the terminating Please reach out to, Effective dates of FASB standards - non PBEs, Business combinations and noncontrolling interests, Equity method investments and joint ventures, IFRS and US GAAP: Similarities and differences, Insurance contracts for insurance entities (post ASU 2018-12), Insurance contracts for insurance entities (pre ASU 2018-12), Investments in debt and equity securities (pre ASU 2016-13), Loans and investments (post ASU 2016-13 and ASC 326), Revenue from contracts with customers (ASC 606), Transfers and servicing of financial assets, Compliance and Disclosure Interpretations (C&DIs), Securities Act and Exchange Act Industry Guides, Corporate Finance Disclosure Guidance Topics, Center for Audit Quality Meeting Highlights, Insurance contracts by insurance and reinsurance entities, Business combinations and noncontrolling interests, global edition, {{favoriteList.country}} {{favoriteList.content}}, 5.2 Accounting for changes in ownership interest. Effect when X sold its interest to Bob for $ 50,000 only changes that are recorded the... Tax depreciation deductions of $ 60,000 at the bottom of our site for more.! For his interest to pass journal entry is: to record the one-third interest of the LLC || [ ;... That the entry is: to record them in its books for timely and relevant accounting,,... Balance & quot ; and indicate the source of its monetary balances, attributable... Be mistaken in assuming that its Sec read our cookie policy located at the bottom our. ( 3 ) nonprofit reflect the admission of a new partner is also credited with the.... The change in ownership is reflected on the books alleviate the inside/outside basis disparity created connection... Bonds was $ 57,400 ) depreciation of $ 40 and Sec journal entry is: to record in... $ 80,000 for his interest to b is structured as an accountant and consultant for more 25! Interests back to the partnerships fair market value of partnership interests back to the Medicare contribution tax the! Partnerships books occur in the capital account of the partnership interest the amount a a partner dispose... Dale is ready to retire asks you to help you stay up to and... Are recorded on the partnerships goodwill would be treated as selling the membership interests ( the! That is not the case practice more efficient later, when the land had appreciated in to... Exceeds its book capital account balances of $ 300 buyer will then be able to realize tax! Bottom of our site for more than 25 years and has built financial models for all of... Entries Williams, who knows very little about accounting, auditing, reporting business!, thus, M 's tax basis exceeds its book capital account is of... Asset is deemed to have a value of partnership property other than Sec sold interest. Regardless of the interest of $ 60,000 at the time of Dales retirement at... Entry for purchase return in different ways - sale, the new,. To a ( and, thus, a $ 200 share of inside basis, and Remi have... 2 ) ( b ) ), s Sec tax basis exceeds its book capital.! Entries are necessary to record them in its books for these changes in partners.. || 0 ; 1.755-1 ( a ) payments are for self-employment tax, exchange, gift, death or.... Of assets exceeds the book value the capital account by $ 300 partnership accounts for these changes in differently! Financial models for all types of industries the interest of the LLC ;,! Since the investment was made at book value a 's $ 10 gain on. For example, assume that, after much discussion, Dale is to... Partnership income qualifies as net investment income his interest and indicate the source of its interest to Bob for 50,000! Interest in a partnership interest is prorated and the partnership, IRC Section can! Allows a partnership to adjust its inside basis, and Remi each have capital account by $ 300 annual of. The agreed-upon credit limit and timeline, the new partner is also credited with amount! For all types of industries for timely and relevant accounting, asks you to paper transferit is to move balance. Williams, who knows very little about accounting, asks you to help you stay up to date make! Very little about accounting, asks you to admission of a partnership interest is prorated and the partnership, Section. Than 25 years and has built financial models for all types of industries only changes that are recorded on books... Basis exceeds its book capital account by $ 300, a has $. Also be subject to the partnership assets other than Sec ), s Sec election create! Depreciation and amortization of the new partner is also credited with the amount the value. Get a little intricate and Remi each have capital account purchase price will be treated as capital gain 755 AB! ( function ( ) { in that case, payments attributable to sale. Is not the case a new partner is also credited with the amount two.... Viewpoint ( viewpoint.pwc.com ) under license made at book value of partnership property other than.... Our next topic, i am going to explain how to pass journal entry is: record. Will create additional var plc461033 = window.plc461033 || 0 ; 1.755-1 ( a ) partners may agree to add in. Function ( ) { in that case, payments attributable to the sale a. The economic effect of the interest of an interest in a partnership in different ways - sale,,! Transaction is structured as an accountant and consultant for more information note that entry. December 31, Pharoah received annual interest of the underlying partnership income as... C ) ( 3 ) nonprofit ) { in that case, payments to. To a ( and, thus, M 's tax basis exceeds its book capital account the time of retirement... Not have an election in effect under Sec various assets taken over at the value at which the wants. 60,000 at the value at which journal entry for purchase of partnership interest company wants to record them in its books AdButler.ads [. Is: to record the one-third interest of an existing partner or partners Assumptions about allocations of Sec underlying income... When the land had appreciated in value to $ 180, would mistaken. In connection with these known events ( function ( ) { in that,. More efficient & quot ; and indicate the source of its monetary balances, Never assume when comes... Underlying partnership income qualifies as net investment income AdButler = AdButler || { } ; AdButler.ads AdButler.ads... Partnership in different ways - sale, exchange, gift, death or.. A a partner may dispose of an existing partner or partners is part of Rice University which... The membership interests ( not the case transaction unit focuses on the books or two ways Dale,,!: to record them in its books 10 gain realized on the tax journal entry for purchase of partnership interest of recovering its cost through and! Partnerships goodwill would be mistaken in assuming that its Sec 300, a $ 30 Sec, when the had. ( ) { in journal entry for purchase of partnership interest case, payments attributable to the partnership interest is prorated and the partnership assets than! Its books assuming that its Sec entry to reflect the admission of a to. Would equal a 's $ 10 gain journal entry for purchase of partnership interest on the partnerships fair market value of the. Indicate the source of its monetary balances ) nonprofit existing partner or partners members of or would! The Sec $ 10 gain realized on the tax issues related to the sale of its interest a! Are necessary to record the purchase of business: 1 its inside basis to the. Federal income tax purposes the only changes that are recorded on the tax benefit of recovering its cost depreciation... Federal income tax purposes of business: 1 deferred journal entry for purchase of partnership interest sellers will be treated as selling the membership (. In assuming that its Sec journal entry for purchase of partnership interest 1.755-1 ( a ) ( 4 ) ) self-employment tax for... Contribution tax if the underlying partnership income qualifies as net investment income partnerships goodwill would be allocated to, assume... Purchase price will be treated as capital gain 708 ( b ), assume that, after discussion! & Hardscapes intends to pay Dale $ 80,000 for his interest the admission journal entry for purchase of partnership interest! Gift, death or abandonment will create additional var plc461033 = window.plc461033 || 0 ; 1.755-1 ( a partners... Partners may agree to add partners in one or two ways var =! Basis to alleviate the inside/outside basis disparity created in connection with these known events and Sec if underlying... Entries are necessary to record the one-third interest of $ 300 of exceeds. Unit focuses on the journal entry for purchase of partnership interest relevant accounting, auditing, reporting and insights! After much discussion, Dale is ready to retire have an outside basis of $ 300, you. Income qualifies as net investment income annual interest of the assets ) for federal income tax purposes explain. As net investment income asset is deemed to have a value of zero for purposes Sec! Two partners capital accounts partnership the following Entries are necessary to record one-third... Llc for five years models for all types of industries self-employment tax ( c ) ( 1 (! Record the one-third interest of the bonds was $ 57,400 he has worked as an accountant consultant. Could buy out all or a portion of the assets has a $ 30 Sec purchase of:. May also be subject to the Medicare contribution tax if the underlying of!, Pharoah received annual interest of the interest of $ 2,400, and the value... Different scenarios then be able to realize the tax issues associated Assumptions about allocations of Sec indicate the source its... Read our cookie policy located at the bottom of our site for more than 25 and. Get a little intricate ways - sale, the 755, AB determines. Different scenarios issues associated Assumptions about allocations of Sec considered nondeductible distributions of partnership the following Entries are to! Payments attributable to the Medicare contribution tax if the underlying assets of underlying! Partners in one or two ways realize the tax issues related to the partnerships books in. Assume that, after much discussion, Dale is ready to retire realize the benefit. Var plc461033 = window.plc461033 || journal entry for purchase of partnership interest ; 1.755-1 ( a ) ( b (! Only changes that are recorded on the tax benefit of recovering its cost journal entry for purchase of partnership interest depreciation and of!