Seminar C: New Partnership Audit Rules: Why They Are so Important for Estate Planners
New rules that revolutionize partnership audits for years beginning in 2018 have not only had procedural but also substantive effect. Contrary to publicity when enacted, these rules apply to partnerships of all sizes. Those who are partners in the year in which the audit is being conducted (the Adjustment Year Partners) may bear the audit tax burden even though those who were partners in the year being audited (the Review Year Partners) received the benefits. Because (surprisingly) the Review Year Partners (who might not be partners anymore) may control that process, Adjustment Year Partners need protection. Also, affected partnerships may bear tax at higher rates than those that applied to the Review Year Partners.
This seminar will discuss the procedural and substantive tax consequences of being subjected to this regime; who qualifies to elect out of the regime, including how common estate planning tools can affect eligibility; and provisions to include in partnership (or operating) agreements to address conflicts between Review Year Partners and Adjustment Year Partners and to control the audit process
Speakers: James Calzaretta, Chicago, IL Steven B. Gorin, St. Louis, MO T. James Lee, Phoenix, AZ
ACTEC 2018 Annual Meeting March 9, 2018 San Antonio, TX
