CCA 201101015: A tax matters partner designation remains effective until termination

Plain-English summary

Chief Counsel Advice addressed whether a tax matters partner (TMP) remained designated and could bind the partners. It states that the designation remains effective until a terminating event occurs under the cited Treasury regulation, and the facts did not appear to show such an event. The advice notes that a TMP with an irreconcilable conflict of interest known to the IRS may not bind the partners in some circumstances. It also states that a generic FPAA that does not specifically name the TMP is valid.

Ruling snapshot

• Question: Does a tax matters partner designation remain effective, and is a generic FPAA valid without naming the TMP?
• Outcome: Advice given
• Key authorities: Treas. Reg. §§ 301.6231(a)(7)-1(L) and 301.6223(a)-1; Chomp v. Commissioner; Seneca v. Commissioner; Trans-Pac; River City Ranches

Full text (IRS public release)

ID: CCA_2010100715033637 Number: 201101015
Release Date: 1/7/2011
Office: ----------
UILC: 6231.07-00

From: --------------------
Sent: Thursday, October 07, 2010 3:03:39 PM
To: -------------------
Cc: ------------
Subject: RE: TEFRA question

The designation of a TMP remains in effect until a terminating event occurs under Treas. Reg. 301.6231(a)(7)-1(L). It does not appear that a terminating event has occurred under the regulations. The courts, however, have held that in some circumstances where the TMP has an irreconcilable conflict of interest that the Service is aware of, the TMP may not bind the partners. See, e.g., Trans-Pac (Fed. Cir) and River City Ranches (9th Cir).

All of the above is likely irrelevant in any case since a generic TMP FPAA that does not name the TMP specifically is valid. Treas. Reg. 301.6223(a)-1; Chomp v. Commissioner; Seneca v. Commissioner. ------
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