Ezel / IRS Rulings / 200922054

CCA 200922054: Direct partnership-adjustment notice depended on why partners lacked notice rights

Number
200922054
Outcome
Advice
Document type
Chief Counsel Advice
IRS subject
Notice to Partners of Proceedings
Topics
Procedure, penalties, and administration
Code sections
§ 6223
Ruling dated
April 30, 2009
Publicly released
May 29, 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.

Currency note: this determination was released in 2009
Statutory amendments, regulation changes, court decisions, or later IRS guidance may have changed the analysis since then. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, threshold, or position mentioned here.
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 addressed whether partners sent a notice beginning a partnership audit also needed direct notice of the final partnership administrative adjustment. Under the TEFRA rules discussed in the email, partners holding less than one percent in a partnership with more than 100 partners did not require direct final notice because they received it through the tax matters partner. The result differed for indirect partners holding through another pass-through entity who had been identified under section 6223(c)(3) and the applicable regulation. Those identified indirect partners were entitled to direct final notice. The advice made the reason for the partners' original non-notice status decisive.

Ruling snapshot

  • Question: Did non-notice partners who received an audit-opening notice also need direct notice of the final partnership adjustment?
  • Outcome: Advice given: no for the specified small-interest partners, but yes for identified indirect partners.
  • Key authorities: IRC § 6223(b)(1), (c)(3), (e)(1)(B)(i); Treas. Reg. § 301.6223(c)-1(f).

Full text (IRS public release)

ID: CCA_2009043009154737 Number: 200922054
Release Date: 5/29/2009
Office: --------------
UILC: 6223.00-00

From: -------------------
Sent: Thursday, April 30, 2009 9:15:51 AM
To: --------------------
Cc: --------------------------------
Subject: RE: NBAP issued to non-notice partners

It depends on why they are non-notice partners. If they have less than a one percent interest in a partnership with more than 100 partners, then we don't need to send them direct notice of the FPAA since they get such notice through the TMP. See I.R.C. 6223(b)(1) and (e)(1)(B)(i).

If they are non-notice partners because they hold an interest in the partnership through another passthrough entity, then we should send them the FPAA because they have been "identified" in accordance with section 6223(c)(3) and Treas. Reg. 301.6223(c)-1(f), entitling them to direct notice.

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