The Bipartisan Budget Act of 2015 (BBA) significantly changed the way the IRS will audit partnerships. The Act repeals the current partnership audit rules (TEFRA and ELP) and replaces those with new rules that will most likely increase partnership audit rates. These rules take effect for tax years beginning after December 31, 2017:
Of course these rules are more extensive than the few changes mentioned above. The IRS is in the process of releasing a complete set of final regulations so as more concrete details emerge we will pass those on. Please feel free to reach out to one of our tax professionals with additional questions on this matter at 859-331-1717.
Please see Rudler PSC e-Tip New Partnership Audit Rules by Suzanne Danks, CPA, Tax Supervisor, for more details.