Ezel / IRS Rulings / 1025060
Chief Counsel Advice 1025060 Released June 25, 2010 Advice

IRS explained who is bound by a partnership settlement agreement

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This page covers one taxpayer's ruling from 2010, 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 2010
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 resolved one taxpayer's situation on its specific facts, 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

The IRS advised that under IRC § 6224(c)(1), a pass-through partner can sign a settlement agreement that binds indirect partners. A trust can therefore sign through its trustee, making the agreement binding on the grantors or beneficiaries. If a grantor or beneficiary signs for that person alone, the agreement binds only the signing spouse. The other spouse is not bound unless that spouse also signs.

Ruling snapshot

  • Question: Which partners and spouses are bound when a trust or individual signs a settlement agreement?
  • Outcome: Advice given
  • Key authorities: IRC § 6224(c)(1); instructions to the applicable form.

Full text (IRS public release)

ID: CCA_2010052513533537 Number: 201025060
Release Date: 6/25/2010
Office: ----------
UILC: 6224.01-01

From: --------------------
Sent: Tuesday, May 25, 2010 1:53:39 PM
To: -------------------
Cc: ------------
Subject: RE: signatures

Under section 6224(c)(1) a pass-thru partner can sign a settlement agreement that binds the indirect
partners. Thus a trust can sign an agreement through its trustee that will be binding on the
grantors/beneficiaries.

If, instead, a grantor/beneficiary signs on his own behalf, the agreement only binds the signing spouse.
This is explained in the instructions to the Form. The other spouse will not be bound in this situation
unless she also signs.

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