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U.S. Treasury, IRS to close $50 billion tax loophole on partnerships

By Thomson Reuters Jun 17, 2024 | 8:33 AM

WASHINGTON (Reuters) – The U.S. Treasury and Internal Revenue Service said on Monday they will close a tax loophole exploited by large, complex partnerships, an action that they estimated could raise $50 billion in new revenue over 10 years.

The Treasury said the IRS would no longer allow partnerships to shift tax liabilities to related parties or different legal entities in order to maximize tax deductions and minimize liability.

New guidance on the subject coincide with the IRS’ stepped-up enforcement campaign to increase audits of large, complex partnerships, backed by some $60 billion in funding over 10 years for the agency approved by Congress in 2022.

(Reporting by David Lawder; Editing by Chizu Nomiyama)