FPAA may address partnership-item basis in the sale year

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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