Tax Court rules that losses from abandonment of partnership interest are capital
Jul 31, 2017
In Watts v. Commissioner, T.C. Memo. 2017-114 (June 14, 2017), the U.S. Tax Court rejected the taxpayer’s claim of an ordinary abandonment loss on the disposition of a partnership interest because the taxpayer failed to establish that they did not share in the partnership’s liabilities and did not offer any evidence as to how their actions constituted an intentional and overt manifestation of abandoning the partnership interest.