Contact: Shirley Twillman, 202-434-9220, firstname.lastname@example.org
Washington, D.C. (June 13, 2017) – The American Institute of CPAs (AICPA) has requested that the U.S. Department of the Treasury and the Internal Revenue Service (IRS) work with Congress to pass legislation to delay by one year the effective date of the new “Centralized Partnership Audit Regime.” The current effective date is December 31, 2017.
“This new Regime represents a significant departure from previous law,” Annette Nellen, CPA, CGMA, Esq., chair of the AICPA Tax Executive Committee, wrote. (Letter attached.) “It will require a substantial effort on the part of Treasury, the IRS, the tax practitioner community and the affected taxpayers (which includes virtually every partnership and their partners) to develop and comply with new rules, regulations and procedures to establish a fair, equitable and administrable Regime.”
Nellen noted that the process of developing the necessary framework to operate the Regime is still in a very early stage. “The AICPA believes that it is unlikely that all the procedures and guidance necessary for taxpayers to make informed decisions regarding its provisions will be established before the current effective date at the end of this year,” she stated.
The letter identified six issues that support a delay in effective date:
- Necessary regulations have not been issued by the IRS;
- Withdrawn regulations contained significant gaps;
- Proposed technical corrections bill would clarify and modify elements of the Regime;
- Impact on financial reporting standards remains unclear;
- Partnerships need to amend or draft their partnership agreements for the new Regime; and
- Impact on state tax law remains uncertain.