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Ezel / IRS Rulings / 202020001
Chief Counsel Advice 202020001 Released May 15, 2020 Advice

Partner-level basis may be adjusted without reopening the partnership return

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This page covers one taxpayer's ruling from 2020, 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 2020
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 a partner's outside basis is an affected item that may be adjusted in a partner-level examination while accepting the partnership return as filed. The examiner may correct the overall outside-basis computation and non-partnership-item components. The examiner may not change partnership-item components of basis without opening a partnership-level TEFRA proceeding. The memorandum cites Meruelo and Roberts for that distinction.

Ruling snapshot

  • Question: May an examiner adjust a partner's outside basis without opening a partnership-level examination?
  • Outcome: advice given, yes if the partnership return and all partnership-item components are accepted as filed
  • Key authorities: Former IRC § 6231; Meruelo v. Commissioner; Roberts v. Commissioner

Full text (IRS public release)

ID: CCA_2019110508450043
UILC: 6231.03-00, 6231.05-00

Number: 202020001
Release Date: 5/15/2020
From:
Sent: Tuesday, November 05, 2019 8:45:00 AM
To:
Cc:
Bcc:
Subject: RE: ---------Review of Basis Computation - Captial Contribution Question

Good morning,

Sorry, I am just now getting to this. I was out of the office last week and I spent most of
yesterday catching up. The partner’s outside basis in his/her partnership interest is an
affected item. You may adjust an affected item at the partner level without opening a
partnership-level examination if you accept the partnership return as filed. See Meruelo
v. Comm’r, 691 F.3d 1108 (9th Cir. 2012); Roberts v. Comm’r, 94 T.C. 853 (1990). In
adjusting outside basis at the partner level in this manner, you cannot change any of the
partnership-item components of outside basis without opening a TEFRA proceeding.
You can adjust the overall computation of outside basis (again, accepting all the
partnership item components as filed on the partnership return) and any non-
partnership-item components of outside basis. Please let me know if you have any
questions.

Thanks,

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