Title 26 — Internal Revenue CodeRelease 119-73

§722 Basis of Contributing Partner’s Interest

Title 26 › Subtitle Subtitle A— Income Taxes › Chapter 1— NORMAL TAXES AND SURTAXES › Subchapter K— Partners and Partnerships › Part II— CONTRIBUTIONS, DISTRIBUTIONS, AND TRANSFERS › Subpart A— Contributions to a Partnership › § 722

Last updated Apr 6, 2026|Official source

Summary

When you contribute money or property to a partnership in exchange for a partnership interest, your starting basis in that interest equals the cash you put in plus your adjusted basis in the property you contributed. If contributing to an investment-company-type partnership caused you to recognize gain, that gain is added to your basis too.

Full Legal Text

Title 26, §722

Internal Revenue Code — Source: USLM XML via OLRC

The basis of an interest in a partnership acquired by a contribution of property, including money, to the partnership shall be the amount of such money and the adjusted basis of such property to the contributing partner at the time of the contribution increased by the amount (if any) of gain recognized under section 721(b) to the contributing partner at such time.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

Amendments

1984—Pub. L. 98–369 inserted “under section 721(b)” after “gain recognized”. 1976—Pub. L. 94–455 inserted “increased by the amount (if any) of gain recognized to the contributing partner at such time” after “at the time of the contribution”.

Statutory Notes and Related Subsidiaries

Effective Date

of 1984 Amendment Pub. L. 98–369, div. A, title VII, § 722(f)(2), July 18, 1984, 98 Stat. 974, provided that: “The

Amendments

made by paragraph (1) [amending this section and section 723 of this title] shall take effect as if included in the

Amendments

made by section 2131 of the Tax Reform Act of 1976 [Pub. L. 94–455].”

Effective Date

of 1976 AmendmentFor

Effective Date

of amendment made by Pub. L. 94–455, see section 2131(f)(3)–(5) of Pub. L. 94–455, set out as a note under section 721 of this title.

Reference

Citations & Metadata

Citation

26 U.S.C. § 722

Title 26 — Internal Revenue Code

Last Updated

Apr 6, 2026

Release point: 119-73