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A partnership can allocate specific items differently among the partners even though the partners have contributed property to the partnership in the same amounts. To
A partnership can allocate specific items differently among the partners even though the partners have contributed property to the partnership in the same amounts. To do this Section 704(b) requires that the partnership agreement must precisely detail how the items are specifically allocated among the partners and requires that the special allocation meet an economic effect test. What are the three requirements of this test? (briefly describe them below)
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