peter deals with what constitutes a partnership by them which was the basis for the lower court's opinion that we were closed from or that there was no jurisdiction the case because what we were point made at the very end of your brief but it it it at least seem to me to be pertinent to this whole inquiry and that has to do with the question of what happens to the basis if for all that extra money sure that's a con if that really contribution cash if they can come back after me but that's not the reality of what happened in this case he wasn't ever on the line for an additional eight hundred thousand dollars he got out of the eight hundred thousand dollars obligation that he wasn't released from eight hundred eighty two thousand and seven dollars of partnership liabilities that that wasn't deemed cash contribution but what i am saying is that there was there was also representative deads he could have given it as you say he contribution to the partnership well actually i believe that he did it's better fact the government's argument i think supports the fact that mr bassett obtained the eight hundred thousand dollar basis the reason for that  dollars the government is saying that as a result of the partnership sustained you need to review two thousand dollars loss that that's a partnership quite a bit should be allocated among the partners conceivably even the mr bassett and as a result of that  thousand dollar basis that means that mr bassett must crypt contribute something to the partnership that had eight hundred eighty thousand dollars a basis otherwise there would be no loss that had been sustained but the bottom partnership  good here here it seems i mean there was a dean at the contribution by virtue of the fact that he became indebted the fact that represented additional purchase price that was paid by mr bass and for the partnership  a does that mean that if he had filed his taxes ten years ago and had filed them the way that you now want to change that that would have been accepted there would have been no problem with well we might be have to have in this is this is kind of why i am baffled that i don't necessarily understand all of the tax law but it seems to me that if he is reporting it in any which way wouldn't partnership have had to have reported it on there kate wanted to well and how so does that mean there i guess i'm wondering who want to be held whose feet all could be held to the fire for the fact that it wasn't done because now the time to fire to the can actually bring a partnership level pretty desperate and so who's really is not like a partnership or healthy people what would happen in the circumstance post we could rewind to the relevant time period in that you swooped in you know the year after the fall to return and when there was still time to do all of this what would mr bethany have done under those circumstances if we were in the ideal world where it was just one year after he filed and you could have helped advise him what would you were told that he do reopen a partnership level proceeding declare it change the k y and all had that the way he in fact did you'd have a much harder road wouldn't you if you were then trying to change your treatment because it would be inconsistent with the way the partnership had treated them so are you saying that people are the partnership was reporting last post they actually made a determination and the determination was consistent with the way that thing actually treated it in one nine hundred ninety nine apartment in one thousand nine hundred ninety one and so if they had made a determination would you be under those circumstances able to come into court and continue to make this argument today which is mr patten would like to treated and treated as death though he liked the way given his involvement that's really understands incentive to do this but i'm just wondering if there had been a partnership level the partnership to represent that release as a cancellation of get which then passes through mr comey if there was some way of reporting back to mr bassett if that's what i would have the partnership to do and you think that's the correct tax treatment of that item i mean you could actually absolutely spectum mr besting but you would have regarded that as the consistent way for the partnership to be treated yes because our on the partnership respecting that characterization is a claim attributable to a partnership which may not be brought in every partner's individual refund action under section and seventy four twenty two can i ask you the same question i began with mr you were is can you explain to me what the the rule of the on the basis is in the i think that's important to know your honor we think it's quite beside the point because this was a matter that could not be reopened at this point it was a partnership matter the whole characterization of the transaction is a partnership that could not be gotten into in individual partners refinance it was it was a jurisdiction if we were back in ninety ninety one what would you think the correct tax treatment of this set of transactions would have been because the governor believes tends to believe although as they say this was not something that was developed in the court below we tend to believe that it was it was it was correctly done at the time a sale as as a sale right and you think a sale with eight hundred eighty thousand dollars worth of gain  presumably so you're right so that takes care of the basis that your answer then is for the basis is you don't think there's a step up in basis probably not but we're getting back to kenya which i believe governs th skates the the character of the income that passing received from the release of his deficit restoration income is a partnership that simply cannot be challenged here in the section sixty two thirty one defines a partnership and as any i don't require to be taken into account for the partnerships taxable year as you noted the partnership apparently failed to take it into account but it was nonetheless obliged to take apart the currency could taken into account fact that the partnership didn't include the information thereby it wasn't treated as anything for the purposes of the partnership i'm a struggling with why not leave thing out on a limb i mean almost any treatment he gives it is presumably wrong then isn't that right because the partnership didn't treat it the iris didn't have a chance to challenge the partnership level no presumably any treatment he gives it at all is wrong the higher ups had the opportunity to challenge it when and when mr bassett who submitted his original returns timely at the time for challenging that for the i r s has passed as has you just said it could only be it only really something properly challenge at the partnership level and no you wouldn't would you then would the i r s then have challenge mr pathname at the partner level with regard to his treatment of it when it wasn't disclosed it would have had to been did at the partnership level at that point seeing that there was an inconsistency between the treatment by the partnership that is no treatment at all and mr bassett treatment whichever it was the i r s could at that point have open the matter at the partnership it could not have simply gone to mr bassett and said mr besson you're wrong here which is the way he was ported it would have had because that is an item that would have affected the other partners and would i take it if he had in order to for him to take you to get the benefit of the bad debt that the partnership present but not just the amount to which mr bassett commits but also the character of the income he received from the partnership is also partnerships items was a release that was created at the partnership level among all the other partners through through this document that basically cleared up everyone's relationship with everyone i so it is what an accounting for arising out of the partnership and under the regulations  company and the other which is that which is related strictly to the partner the character of the transaction it is part of the partnership pump it's not something that is only related to what's going on with mr best and it is it is necessarily treated therefore at the partnership level as the as the court stated in kenya rather than the partner  the remedy if if he had wished it kept recur to rise the income he received from the release would have been to request for administrative adjustment at the partnership and the time for that unfortunately characterized but there i think there would be well there might be an issue as to whether it's were properly treat is that cancellation income workers compensation income but it would have every right to of brought that action to challenge  partnership certainly didn't think that it was responsible for reporting any consequences to mr passing as to result a bit of that negative capital account existing when he was liquidated and it certainly release as creating as he did originally as creating income for him which he then characterizes long term capital gains assume for the moment that that is correct the correct characterization what would be the consequences of that characterization for the partnership and for mr cowen there's the consequences of the surpassing simply being released from this long term it would be that the ira's could consistently view the treatment by mr cohen of that same transaction as a bad debt and on the other hand side of the transaction as a n that's what the government could could contend well i mean do you think that's right is that the right way for that for that transaction to be treated assuming that mr bassim was correct in treating it as a his charge from we're saying that as you put it before it washed out because under of the position that we're taking mr bascomb should've increased the basis of this partnership interest the treatment that mr bassim gave to the transaction dictates the way mr cowen is obliged to treat the transaction let's let's let me add to my ok that that he not only do we say that the treatment as you know whether it's correct or not ultimately the treatment that's binding on mr cohen is that treatment that let's say hypothetically that mr very well cases submitted