P.R. Laws tit. 13, § 30565
(a) General rule. — A partner’s distributive share of income or loss of the special partnership, or of any tax credit of the special partnership shall be determined by the partnership agreement, except under the circumstances described in subsection (b) of this section.
(b) Exceptions. — The distributive share of a partner of the special partnership’s income or loss, or of any tax credit of the special partnership shall be determined in accordance with the partner’s interest if, when all facts and circumstances are taken into account:
(1) The partnership agreement does not provide as to the partner’s share of special partnership’s income, loss or tax credit, or
(2) The allocation to a specific partner of share in the gains, losses of the special partnership or in the tax credits of the partnership does not respond to economic realities. It shall be understood that the allocations contained under the agreements of partnerships operating under the Tourism Incentives Act of 1983, §§ 693 et seq. of Title 23, and the Tourist Development Act of 1993, §§ 6001 et seq. of Title 23 or any successor law of a similar nature, respond to economic realities.
(c) Family partnership. —
(1) Distributive share of donee includible in gross income. — In the case of any special partnership interest created by gift, the distributive share of the donee under the partnership agreement shall be includible in his/her gross income, except to the extent that such share is determined without allowance of reasonable compensation for services rendered to the partnership by the donor, and except to the extent that the portion of such share attributable to donated capital is proportionately greater than the share of the donor attributable to the donor’s capital.
(2) Purchase of interest by member of family. — For purposes of this section, an interest purchased by one member of a family from another member shall be considered to be created by gift from the seller, and the fair market value of the purchased interest shall be considered to be donated capital.
(3) For purposes of this subsection, the family of any individual shall include only his/her spouse, ancestors, and lineal descendants, and any trusts for the primary benefit of such persons.
History —Jan. 31, 2011, No. 1, § 1114.15, retroactive to Jan. 1, 2011.