Page 97 - 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
 After a final partnership-level determination (on one or more partnership items) has been made, either through final court decision or settlement, the Internal Revenue Service makes its computational adjustments and issues assessments. At this time, a partner can challenge the assessment only with respect to the computation itself and not as to the merits of any partnership level adjustment; and
 The statute of limitations for all partners’ partnership items generally (but not exclusively) is determined based on the filing date of the partnership return. The TMP may extend the statute of limitations with respect to partnership items and certain “affected items” by executing a partnership-level extension agreement, which is effective for all partners even if the partners do not individually agree to an extension for their individual tax return year(s).
The TEFRA rules do not change the process for collecting underpayments with respect to deficiencies at the partner (not the partnership) level. A settlement agreement with respect to partnership items binds all parties to the settlement.43 The Internal Revenue Service has set forth procedures for entering into such partnership audit settlement agreements.44
The GENERAL EXPLANATION OF TAX LEGISLATION ENACTED IN 2015 (JCS-1-16, March 2016) continues:
“Tax Matters Partner”
The TEFRA rules establish the Tax Matters Partner as the primary representative of a partnership in dealings with the IRS. The Tax Matters Partner is a general partner designated by the partnership or, in the absence of designation, the general partner with the largest profits interest at the close of the taxable year. If no Tax Matters Partner is designated, and it is impractical to apply the largest profits interest rule, the IRS may select any partner as the Tax Matters Partner.
Notice requirements: notice required to partners separately
with the Court of Federal Claims. For the definition of a statutory notice of deficiency in non- TEFRA partnership cases, see I.R.C. §§ 6212, 6226(a).
43 I.R.C. § 6224(c).
44 These procedures are summarized in Part F of Chief Counsel Notice 2009-27, “Frequently Asked Questions Regarding The Unified Partnership Audit And Litigation Procedures Set Forth In Sections 6221-6234,” IRS CC Notice 2009-027, August 21, 2009.]
© Terence Floyd Cuff and Jerald David August, 2016
28