New Partnership Audit Rules: Concepts and Issues, Part 1
On November 2, 2015, President Obama signed into law the Bipartisan Budget Act of 2015 (BBA), which contains new rules governing partnership tax audits. On December 18, 2015, Congress passed, and Obama signed into law, the Protecting Americans From Tax Hikes (PATH) Act of 2015, which includes some corrections to the new audit rules, effective as if those corrections had been part of the BBA. This report reviews the reasons for the enactment of the new audit rules, summarizes the core concepts and elements of the new regime, and discusses various practical issues that arise under the new audit rules, with a particular emphasis on investment funds, so-called UPREIT and UP-C structures, acquisitions involving partnerships, and securitization transactions.
To see Part 2 of this report, please click here.