Page 194 - The TEFRA Partnership Audit Rules Repeal:

ALI CLE Live Video Webcast / “The TEFRA Partnership Audit Rules Repeal: Partnership and Partner Impacts” June 7, 2016, Jerald David August and Terence Floyd Cuff
Reviewed year partners are liable for penalties.
Reviewed year partners pay tax for year in which they receive the adjusted information return.
Deficiency interest runs from reviewed year [the year under audit].
a. Making the Push Out Election.
The partnership cannot be complacent. The partnership needs to make the push out election not later than 45 days after the date of the notice of final partnership adjustment. This is a statutory requirement. It is doubtful that the Internal Revenue Service will be able to provide relief for late elections. The precise method of making the election is left to future regulations.
The partnership needs, as a condition to push out relief, to furnishes to each partner of the partnership for the reviewed year [the year under audit] and to the Internal Revenue Service a statement of the partner’s share of any adjustment to income, gain, loss, deduction, or credit (as determined in the notice of final partnership adjustment). It is not clear whether the Internal Revenue Service will impose the same 45 day requirement for the statements. As the timing will be set forth in regulations, the Internal Revenue Service may be able to give relief for late statements. A statement is furnished when it is mailed.
The push out election is revocable only with the consent of the Internal Revenue Service.
The push out election may be made whether or not the partnership files a petition for judicial review of the notice of final partnership adjustment.108
The failure of the partnership timely to provide this partner statement may invalidate the push out election. The Internal Revenue Service might insist that the statement is provided to the correct tax partners in cases of ambiguity concerning who is a partner. This might include an unadmitted transferee of an partnership interest whom the partnership fails to recognize as a tax partner.
A mistake in the statement that a partner is furnished conceivably could invalidate the push out election.
108 I.R.C. § 6226(d). See section 411 of the Protecting Americans from Tax Hikes Act of 2015 (Division Q of Pub. L. No. 114-113).
© Terence Floyd Cuff and Jerald David August, 2016
125