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Begonia Partnership 0X-XX12346Taxable Year EndedDecember 31, 2007FOR INFORMATION ONLYThe explanations below provide the reasons why the non-penalty affected items may be asserted after the partnership proceedings have been completed. A petition to any court should not contain a non-penalty affected item issue because the court will not have jurisdiction to consider non-penalty affected items at this time. A court will have jurisdiction to consider partnership related non-penalty affected items only after the partnership and penalty affected item proceeding has been completed and the notices of deficiency asserting the non-penalty affected items are issued.IRC 704It is determined that the partner’s basis for the investment is less than the loss shown on the return. Therefore, the loss in excess of basis is not allowable. IRC 108It is determined that the partners are not insolvent. Therefore, the forgiveness of debt income is not subject to exclusion under IRC Section 108.