Darryll K. Jones (Pittsburgh) has published A Simple Regulation for Partnership Mergers and Mixing Bowls, 106 Tax Notes 1453 (Mar. 21, 2005), also available on the Tax Analysts web site as Doc 2005-4368, 2005 TNT 54-30.  Here is the preamble to his proposed regulation:

The only time a partner should enjoy nonrecognition after the realization of appreciation is on the capitalization of the partnership. Investment should never be a taxable event to the extent it requires postponed personal consumption other than the investment itself. A contribution of appreciated property is a realization event — the partner’s capital account is increased by the full value of property, not just its basis, and because we want to encourage investment — that is, postponed consumption — we should also postpone recognition of the realized, but stored and unconsumed, gain. A merger is a continuing investment so the principle should apply in that context. The particular advantage to the contributing partner is justified by the general benefit to society. There is, however, no further advantage to be gained by granting another nonrecognition opportunity. When the appreciated property is consumed, taxation is appropriate and indeed necessary. Accordingly, when the partnership sells or exchanges the property, whether obtained on initial or continuing capitalization, the gain should be recognized and then only by the contributing partner because she is the one to whom the consumption benefit inures, as proven by the credit to her capital account. It is the contributing partner who selfishly consumed the appreciation and she alone should pay the tax.