Anti-Abuse Rule Revised in Model Tax Law on Partnerships

State tax administrators working on a project addressing the tax treatment of investment partnership income trimmed anti-abuse provisions from its proposed model law in response to concerns expressed by business community stakeholders.

The Multistate Tax Commission’s partnership work group modified features of its “issue outline” on Monday and its model law last Thursday. The work group pulled back on two anti-abuse provisions that were “over-broad and ambiguous,” said Bruce Ely, a tax partner with Bradley Arant Boult Cummings LLP in Birmingham, Ala. and the author of a comment letter submitted to the work group.

“The August ...