e-News for BBA Partnerships Issue Number 2024-1

Resources for BBA Partnerships:  

Tax Information for Partnerships

Modernized e-File (MeF) for Partnerships

Businesses with Employees

About Form 8980, Partnership Request for Modification of Imputed Underpayments Under IRC Section 6225 (c)

About Form 8985, Pass-Through - Statement Transmittal/Partnership Adjustment Tracking Report (Required under Sections 6226 and 6227)

About Form 8978, Partner's Additional Reporting Year Tax

Other Resources

IRS.gov

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All Forms & Instructions

Tax Professional Home

e-Services

Issue Number:  2024-1

Inside This Issue

1. BBA Centralized Partnership Audit Regime
2. Designate a Partnership Representative
3. Elect Out of the Centralized Partnership Audit Regime
4. File an Administrative Adjustment Request under Bipartisan Budget Act of 2015 (BBA)
5. BBA Partnership Audit Process
6. Electronic Submission of Forms by Audited BBA Partnerships and Their Pass-Through Partners
7. OFSS Status

1.  BBA Centralized Partnership Audit Regime

No Update

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2.  Designate a Partnership Representative

No Update

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3.  Elect Out of the Centralized Partnership Audit Regime

No Update

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4.  File an Administrative Adjustment Request under Bipartisan Budget Act of 2015 (BBA)

Updated instructions for Partnerships, S corporations, & trusts (pass-through partner entities) that need to submit Forms 8985 and 8986:

1. Calculate and pay the IU amount based on the adjustments from the F8986 received as a result of an AAR

Note: Whether or not an IU is paid, adjustments that do not result in an IU must be pushed out to partners.

• Submit Form 8985 and, if applicable, Forms 8986 (only required for adjustments that do not result in an IU), to the IRS, as shown below:

* Do not batch submissions using multiple 8985s for the same source partnership and reviewed tax year. For example, Source Partnership files an AAR and furnishes Form 8986 to Pass-Through Partner. Pass-Through Partner prepares Form 8985 and Forms 8986 to further push out the adjustments to its 35 partners. Pass-Through Partner has a total submission of 109 pages (1 cover sheet, 1 Form 8985 and 35 Forms 8986). Because the total submission is over 100 pages, Pass-Through Partner cannot separate the 35 Forms 8986 into smaller batches and attached to multiple 8985s to satisfy the 100 page threshold for faxing.

Important note: The above fax number is not for general use; use only for submitting Forms 8985/8986. Faxes containing more than 100 pages, unreadable or other submissions received at this fax number will not be processed.

2. Further push out all adjustments to its partners

• Furnish a Form 8986 to each reviewed year partner of the pass-through partner.
• Submit Form 8985 and all Forms 8986 to the IRS as shown below:

* Do not batch submissions using multiple 8985s for the same source partnership and tax year. For example, Source Partnership files an AAR and furnishes Form 8986 to Pass-Through Partner. Pass-Through Partner prepares Form 8985 and Forms 8986 to further push out the adjustments to its 35 partners. Pass-Through Partner has a total submission of 109 pages (1 cover sheet, 1 Form 8985 and 35 Forms 8986). Because the total submission is over 100 pages, Pass-Through Partner cannot separate the 35 Forms 8986 into smaller batches and attached to multiple 8985s to satisfy the 100 page threshold for faxing.

Important note: The above fax number is not for general use; use only for submitting Forms 8985/8986). Faxes containing more than 100 pages, unreadable or other submissions received at this fax number will not be processed.

Be sure to only submit the Forms 8985/8986 to the IRS. Copies of other attachments provided to the partners should not be submitted to the IRS.

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5.  BBA Partnership Audit Process

Information related to deposits under IRC 6603 made by a (terminal) partner (to be added to bottom of page):

Taxpayers that desire the Service to return a deposit must submit a written statement to the Internal Revenue Service Center or examining office to which the original deposit was remitted requesting that the deposit be returned. The written statement also must include:

1. The date(s) and amount(s) of the original deposit(s);
2. The type(s) of tax to which the deposit was intended to be applied;
3. The tax year(s) to which the deposit was intended to be applied.

If the deposit was made by a partner of a BBA partnership, the written statement requesting return of all or part of a deposit must be submitted by mail to BBA Operations in Ogden. Mail to:

Ogden - Internal Revenue Submission Processing Center

M/S 4705

1973 N Rulon White Blvd.

Ogden, UT 84201 

In addition to (1), (2) and (3) above, the statement must also include:

4. The name and TIN of the BBA partnership under exam;
5. The reviewed year of the BBA partnership under exam;
6. The Audit Control Number (ACN) of the BBA partnership under exam.

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6.  Electronic Submission of Forms by Audited BBA Partnerships and Their Pass-Through Partners

Instructions for Forms 8985, 8986 and 8978 with Revision date Jan 2024 were published to IRS.gov on January 26, 2024. There were no changes made to the forms. The revision date for Forms 8985 and 8986 remains October 2019 and the revision date for Form 8978 remains January 2023.

If you have problems downloading forms, email the PBBA Help Desk at LBI.BBA.eSubmit@irs.gov and we will email the forms to you. Please read form instructions completely before contacting the help desk for assistance with the upload and submission of BBA audit related forms.  

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7.  OFSS Status

No Update

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