SECTION 9. DETERMINATION OF

APPLICABILITY OF SECTION 1446(f)(1) TO DISTRIBUTIONS BY PARTNERSHIPS

The Treasury Department and the IRS intend to issue regulations providing that for purposes of section 1446(f)(1), if a partnership makes a distribution to a partner, the partnership may rely on its books and records, or on a certification received from the distributee partner, to determine whether the distribution exceeds the partner’s basis in its partnership interest, provided that the partnership does not know or have reason to know that its books and records, or the distributee partner’s certification, is incorrect and the partnership retains a record of the documentation relied upon to establish the partner’s basis for the period described in section 4.04 of this notice.