Title 26 — Internal Revenue CodeRelease 119-73

§733 Basis of distributee partner’s interest

Title 26 › Subtitle Subtitle A— - Income Taxes › Chapter CHAPTER 1— - NORMAL TAXES AND SURTAXES › Subchapter Subchapter K— - Partners and Partnerships › Part PART II— - CONTRIBUTIONS, DISTRIBUTIONS, AND TRANSFERS › Subpart Subpart B— - Distributions by a Partnership › § 733

Last updated Apr 6, 2026|Official source

Summary

When a partnership gives a partner money or property and the partner is not ending their partnership interest, the partner's adjusted basis (their tax value) in the partnership must go down, but not below zero. It goes down by the cash the partner receives and by the partner’s basis in any property given, as figured under section 732.

Full Legal Text

Title 26, §733

Internal Revenue Code — Source: USLM XML via OLRC

In the case of a distribution by a partnership to a partner other than in liquidation of a partner’s interest, the adjusted basis to such partner of his interest in the partnership shall be reduced (but not below zero) by—

(1)the amount of any money distributed to such partner, and

(2)the amount of the basis to such partner of distributed property other than money, as determined under section 732.

Reference

Citations & Metadata

Citation

26 U.S.C. § 733

Title 26 — Internal Revenue Code

Last Updated

Apr 6, 2026

Release point: 119-73