Company: SPH
Filing Date: 2025-02-12
Form Type: S-3
Source: 0001193125-25-024546
Chunk: 20

Company: SUBURBAN PROPANE PARTNERS LP
Filing Date: 2025-02-12
Form: S-3
Chunk 20
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 name account and the nominee or broker has executed and delivered a transfer application for those common units.

12

Tax Consequences of Unit Ownership

Flow-Through of Taxable Income

Subject to the discussion below under “—Entity-Level Collections,” we will not pay any
U.S. federal income tax. Instead, each unitholder will be required to report any share of our income, gains, losses and deductions on the unitholder’s income tax return without regard to whether we make corresponding cash distributions. Each
unitholder will be required to include in income its allocable share of our income, gains, losses and deductions for our taxable year ending with or within the unitholder’s taxable year. Our taxable year ends on December 31.

Treatment of Distributions

Distributions
by us to a unitholder generally will not be taxable to the unitholder for U.S. federal income tax purposes, except to the extent any cash distribution exceeds a unitholder’s tax basis in our common units immediately before the distribution, in
which case the amount of that excess generally will be considered to be gain from the sale or exchange of the common units, taxable in accordance with the rules described under “— Disposition of Common Units.” Any reduction in a
unitholder’s share of our liabilities for which no partner, including the general partner, bears the economic risk of loss, known as “nonrecourse liabilities,” will be treated as a distribution by us of cash to that unitholder. To the
extent our distributions cause a unitholder’s “at-risk” amount to be less than zero at the end of any taxable year, the unitholder must recapture any losses deducted in previous years.
Please read “— Limitations on Deductibility of Losses.”

A decrease in a unitholder’s percentage interest in us
because of our issuance of additional common units will decrease the unitholder’s share of our nonrecourse liabilities, and thus will result in a corresponding deemed distribution of cash. This deemed distribution may constitute a non-pro rata distribution. A non-pro rata distribution of money or property may result in ordinary income to a unitholder, regardless of the unitholder’s tax basis in the
unitholder’s common units, if the distribution reduces the unitholder’s share of our “unrealized receivables,” including depreciation recapture attributable to prior depreciation deductions and/or substantially appreciated
“inventory items,” each as defined in the Code, and collectively,