CCA 200952051: State-law authority could support an LLC representative's Form 872-P signature

Plain-English summary

Chief Counsel Advice addresses who may sign a Form 872-P for an LLC serving as the tax matters partner of a TEFRA key-case entity. The advice states that a person may have authority to bind the LLC if the meeting participants had authority under state law to designate that person and the meeting minutes sufficiently recorded the designation. If that authority is uncertain, the Service should protect its position by obtaining Form 872 agreements from the relevant investor corporation and parent, or by obtaining a designation under Treas. Reg. § 301.6229(b)-1.

Ruling snapshot

• Question: Who may sign a Form 872-P on behalf of an LLC that is the tax matters partner in a TEFRA key case?
• Outcome: Advice given
• Key authorities: IRC § 6229; Treas. Reg. § 301.6229(b)-1; Forms 872 and 872-P

Full text (IRS public release)

ID: CCA_2009120712000754 Number: 200952051
Release Date: 12/24/2009
Office: --------------
UILC: 6229.02-00

From: --------------------------
Sent: Monday, December 07, 2009 12:00:09 PM
To: -------------------
Cc: ------------------------------------------
Subject: RE: Signing Official for an LLC that is TMP to a TEFRA Key Case Entity

If the parties present for the meeting of the TMP LLC had, under State law, authority to designate ---------- as the authorized representative of the TMP LLC re execution and filing of federal forms on behalf of the TMP LLC, and, if the minutes of the meeting are, under State law, a sufficient designation of that authority, then yes, ---------should have authority, under State law, to bind the TMP LLC in a Form 872-P re the TEFRA key case entity. See CC-2009-027, question E2 at 10.

If ----------authority under State law to bind the TMP LLC is uncertain and there is no other individual with certain authority under State law to do so, the Service should, for protective purposes, obtain a Form 872 (addressing partnership and affected items) from the ultimate investor subsidiary corporation and its parent. See CC-2009-027, question E4 at 11. Alternatively, the Service could obtain a Treas. Reg. 301.6229(b)-1 designation re the TEFRA key case entity.