IRS Says Partnership is Presumed When "Husband and Wife" Own An Entity

In a Chief Counsel Advice, the IRS has said that it will presume that an entity is a partnership when a "husband and wife" own the entity unless, of course, an election is made for the entity to be disregarded for tax purposes.  The IRS cited I.R.C. Sec. 761(a) & (f) as the basis for its conclusion.  Only additional facts indicating a sham will cause the IRS to disregard the "wife" as the partner, IRS stated.  IRS also indicated that each spouse should have reported "his/her" share of net earning from self-employment, with appropriate adjustments.  The IRS did not indicate how entities owned by homosexual couples are to be treated.  C.C.A. 201411035 (Apr. 12, 2013).