AICPA Urges IRS to Make Changes to Proposed Partnership Audit Regulations;Outlines Recommendations for Improvement

August 15, 2017

Washington (Aug. 15, 2017)The American Institute of CPAs (AICPA) has urged the Internal Revenue Service (IRS) to make changes to its proposed regulations that are intended to implement the new Centralized Partnership Audit Regime, which was created by the Bipartisan Budget Act of 2015.  The AICPA made multiple recommendations about how to improve the proposed regulations and also requested clarification on a number of the proposed administrative provisions in its Aug. 14 comment letter.

The AICPA recommended changes in the following key areas:

  • Ability to use the “push-out” election by tiered partnership structures
  • How to properly reflect adjustments under the new audit regime in a partner’s basis and capital account 
  • Expansion of eligible partners for opt-out
  • Procedures for appointment and replacement of a partnership representative
  • Partnership’s right to challenge various IRS actions and decisions with the IRS Office of Appeals

The IRS issued the proposed regulations on June 14; they would generally affect partnerships for taxable years beginning after Dec. 31, 2017.