Ezel / IRS Rulings / 201608014
Chief Counsel Advice 201608014 Released February 19, 2016 Advice

FPAA may address partnership-item basis in the sale year

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This page covers one taxpayer's ruling from 2016, which can't be cited as precedent. Ezel answers your situation under the current Code and IRS guidance, with citations.

Currency note: this determination was released in 2016
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

Chief Counsel advised that the IRS could issue a final partnership administrative adjustment for the year in which an item was sold. The item's basis was a partnership item, and the transaction being examined occurred in the sale year. The fact that basis was also a partnership item in an earlier year did not change that conclusion.

Ruling snapshot

  • Question: May an FPAA for the sale year adjust the basis of a partnership item when basis was also a partnership item in an earlier year?
  • Outcome: Yes, because the transaction at issue occurred in the sale year.
  • Key authorities: IRC §§ 6221 and 6231

Full text (IRS public release)

ID:          CCA_2016020413430807              [Third Party Communication:

UILC:        6221.00-00, 6231.03-00            Date of Communication: Month DD, YYYY]

Number: 201608014
Release Date: 2/19/2016
From:
Sent: Thursday, February 04, 2016 1:43:08 PM
To:
Cc:
Bcc:
Subject: RE: Super Quick TEFRA question


Hi ----------,

Nothing has changed. We may issue an FPAA for the sale year only as the basis of the
partnership item sold is a partnership item and the transaction occurred in the sale year.
The fact that the basis of the item was also a partnership item in a previous year does
not change this answer. The transaction at issue occurred in sale year.




Thanks,
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