Tax inclusion: partners' share of firm income before dissolution counts toward tax where firm failed to retain it. The inserted Explanation clarifies that the taxable amount includes the portion of each partner's share of firm income earned before discontinuance or dissolution which the firm could have retained under the retention provision but did not retain, thereby making that not-retained share subject to tax at partner level.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Tax inclusion: partners' share of firm income before dissolution counts toward tax where firm failed to retain it.
The inserted Explanation clarifies that the taxable amount includes the portion of each partner's share of firm income earned before discontinuance or dissolution which the firm could have retained under the retention provision but did not retain, thereby making that not-retained share subject to tax at partner level.
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