CCA 200908042: Partnership termination did not affect its TEFRA audit

Number

200908042

Outcome

Advice

Document type

Chief Counsel Advice

IRS subject

Tax Treatment Determined At Partnership Level; Extension by Agreement

Topics

Procedure, penalties, and administration

Code sections

§ 6221, § 6229, § 6501

Ruling dated

January 22, 2009

Publicly released

February 20, 2009

Source

View Official PDF

Apply this to your situation

This page covers legal advice the IRS Office of Chief Counsel wrote for IRS staff, issued in 2009, which can't be cited as precedent. Ask about your situation and see what the current Code and IRS guidance say, with citations.

Not precedent. Under 26 U.S.C. § 6110(k)(3), this written determination may not be used or cited as precedent. It is advice from the IRS Office of Chief Counsel to IRS personnel on the facts they presented, and identifying details were redacted by the IRS before release. The official IRS release (linked on this page as a PDF) is the authoritative source.

About this page: The plain-English summary and ruling snapshot below were written by Ezel based on the official IRS release. The full text is the IRS's own document.

View official IRS release (PDF)

Plain-English summary

Chief Counsel considered the effect of a technical partnership termination on a TEFRA audit and a limitations extension. The email explained that a TEFRA proceeding audits the partners' partnership items, not the partnership as a separate party, so termination did not affect the audit or the tax matters partner's status for the audited year. It cited Chef's Choice v. Commissioner for that point. It also said that when the tax matters partner signed Form 872-P, the partner extended the § 6501 period for the partners' partnership items, not a limitations period belonging to the partnership.

Ruling snapshot

Question: Did a technical partnership termination affect the TEFRA audit, tax matters partner status, or Form 872-P extension?
Outcome: Advice given: no; the extension applied to the partners' partnership items.
Key authorities: IRC §§ 6221, 6229, and 6501; Chef's Choice v. Commissioner, 95 T.C. 388 (1990).

Full text (IRS public release)

ID: CCA_2009012210242037 Number: 200908042
Release Date: 2/20/2009
Office: -------------
UILC: 6221.00-00, 6229.02-00

From: --------------------
Sent: Thursday, January 22, 2009 10:24:21 AM
To: -------------------------------------------
Cc: --------------------------------
Subject: RE: Soliciting SOL Extension on Technically Terminated Partnership

A TEFRA audit is analogous to a class action audit of the partners for their partnership items for a partnership taxable year rather than an audit of the partnership itself as a separate entity. The partnership as a separate entity is not a party to this audit and cannot petition any FPAA. Thus, its termination has no effect on a TEFRA audit or the status of the TMP for the audited year. See Chef's Choice v. Commissioner, 95 T.C. 388 (1990)(termination of partnership has no effect on the TEFRA partnership audit procedures since the partnership is not a party to such procedures).

Additionally, the Tax Matters Partner is extending the 6501 period for the partners with respect to their partnership items when he signs a Form 872-P. He is not extending the "partnership's statute".

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