Special Allocation Agreement Sample Clauses
A Special Allocation Agreement is a contractual provision that allows parties to allocate specific items of income, gain, loss, or deduction in a manner different from their general ownership percentages. In practice, this clause is often used in partnership or joint venture agreements to address unique financial arrangements, such as allocating tax credits, depreciation, or particular profits to certain partners based on their contributions or negotiated terms. Its core function is to provide flexibility in distributing financial results, ensuring that the economic intent of the parties is accurately reflected and that tax or financial benefits are allocated as agreed.
Special Allocation Agreement. Buyer agrees that Seller shall, at Buyer's expense, have prepared at Seller's direction the federal income tax returns for the Partnership and each Acquired Company for the tax year ended December 31, 1997. Before the due date for filing the Partnership's federal income tax return for its 1997 fiscal year, Buyer further agrees to cause the Acquired Companies to amend the Partnership Agreement at the direction of Seller in order to make any retroactive changes to the allocation of income, gain, loss, deductions and credits (and any items thereof) for the tax year ended December 31, 1997 as permitted by Section 706 of the Internal Revenue Code of 1986, as amended.