Executive summaryThe United States (US) Internal Revenue Service (IRS) released final regulations (TD 9891) under Internal Revenue Code (IRC) Section 721(c) that continue to deny nonrecognition treatment to certain contributions of appreciated property by US persons to partnerships with related foreign partners unless the partnership satisfies specific requirements. To avoid gain recognition, among other things, the partnership must adopt the remedial allocation method under Section 704(c) and the consistent allocation method under the final regulations, in each case with respect to the transferred property. The final regulations follow the expired temporary regulations, with changes or clarifications to the definition of related persons, the...