"Stuart O. Bronstein" <spamtrap[at]lexregia.com> wrote:

- quote -

Yes

- quote -

Thank you for that information.

--ron

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Ron Rosenfeld <ronrosenfeld[at]nospam.org> wrote:

- quote -

Do you mean that you would take out a policy on him and he'd
take out a policy on you?

The insurance premiums would not be deductible. When one
dies the death benefit will be paid, and will not be subject
to income tax. That money will be used to buy his
partnership interest from his heirs, which will have a
stepped up basis in it, so their income tax on this item
will be minimal if any.

In the alternative you could have the partnership buy the
policies. But that's more complicated and don't remember how
that works at the moment.

Stu

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My partner (unofficial partnership) and I, in a venture that
owns two medical offices do not (yet) have a buyout
agreement in the event of the demise of one of us.

Assuming we fund this through insurance, what would be the
tax consequences?

I see at least three transactions going on here.

The insurance premium payments (and we will have different premiums).
The receipt of insurance funds by the survivor.
The payment of these funds to the deceased's estate or spouse.

Thank you for enlightenment.

--ron

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