Ezel / IRS Rulings / 200927032

CCA 200927032: Mitigation can refund income counted twice for a TEFRA partner

Number
200927032
Outcome
Advice
Document type
Chief Counsel Advice
IRS subject
Method of Adjustment
Topics
Other topics
Code sections
§ 1314
Ruling dated
May 18, 2009
Publicly released
July 2, 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 advised that the mitigation rules apply to partners in TEFRA proceedings. A correction may concern a tax year outside the partnership proceeding itself, in which case the IRS could abate the tax and refund the amount attributable to income counted twice. If the IRS failed to do so, the partner could file a refund claim under section 1314(b) within one year of the relevant determination. The email states that this refund mechanism operates despite laws or rules, including TEFRA provisions, that would otherwise prevent the refund.

Ruling snapshot

  • Question: Can mitigation provide a partner a refund for income counted twice when TEFRA rules would otherwise bar it?
  • Outcome: Advice given: mitigation applies, with a one-year refund-claim period after the relevant determination
  • Key authorities: IRC § 1314(b); Chef’s Choice v. Commissioner, 95 T.C. 388 (1990)

Full text (IRS public release)

ID: CCA_2009051808344137 Number: 200927032
Office: --------------
Release Date: 7/2/2009

UILC: 1314.02-00

From: -------------------
Sent: Monday, May 18, 2009 8:34:45 AM
To: ----------------------
Cc: ------------------------------------------------------
Subject: RE: Mitigation in TEFRA

Mitigation applies to TEFRA. Specifically, it applies to the partners since the partnership is not a party to a TEFRA proceeding. See Chef's Choice v. Commissioner, 95 T.C. 388 (1990). The correction need not necessarily apply in the TEFRA proceeding itself if the correction needs to apply to a year not subject to the TEFRA proceeding. We would simply abate and refund the double included income. If we failed to do so the partner could file a refund claim for the double included income under section 1314(b) within one year of the relevant "determination". The refund is made in this manner notwithstanding "any law or rule of law" that would otherwise prevent it, i.e., notwithstanding the TEFRA provisions that otherwise might prevent the refund.

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