Posted by John Cohn, Todd Keator, and Kathleen Gerber
In a recent case, Grecian Magnesite Mining, Industrial & Shipping Co., S.A., v. Commissioner, 149 T.C. No. 3 (July 13, 2017), the Tax Court declined to apply the principles of Rev. Rul. 91-32 when determining whether gain realized by a foreign partner upon the redemption of its interest in a U.S. partnership was effectively connected income with a U.S. trade or business (“ECI”) and, thus, subject to U.S. taxation.