Form 8082 Instruktioner
Instruktioner för formulär 8082, Notice of Inconsistent Treatment or Administrative Adjustment Request (AAR)
Rev. januari 2024
Relaterade formulär
- Form 8082 - Meddelande om inkonsekvent behandling eller anpassningsbegäran (AAR)
Department of the Treasury
Internal Revenue Service
Instructions for Form 8082
(Rev. January 2021)
For use with Form 8082 (Rev. December 2018)
Notice of Inconsistent Treatment or
Administrative Adjustment Request (AAR)
Section references are to the Internal Revenue
determinable until after the period for filing
an AAR has expired. Protective AARs are
subject to AAR statutes set forth in
sections 6227, 6228, and 6229 (prior to
amendment by BBA).
If you are a TMP filing on behalf of the
partnership, the petition period described
in section 6228 (prior to amendment by
BBA) can be extended by using Form
9248, Agreement to Extend the Time to
File a Petition for Adjustment by the Tax
Matters Partner with Respect to
Purpose of Form
Code unless otherwise noted.
Notice of inconsistent treatment. If
Contents
Page
you are a partner in a TEFRA or BBA
partnership, S corporation shareholder,
beneficiary of an estate or trust, owner of a
Reminders . . . . . . . . . . . . . . . . . . . 1
a real estate mortgage investment conduit
(REMIC), you must generally report items
consistent with the way they were reported
to you on Schedule K-1, Schedule Q, or a
foreign trust statement. However, there
may be reasons why you wish to report
these items differently. Use Form 8082,
Notice of Inconsistent Treatment or
Administrative Adjustment Request (AAR)
for this purpose.
Part II - Inconsistent or AAR
Partnership Items. A protective AAR
clearly must state that it is a protective
AAR, alert the IRS to the essential nature
of the adjustment, and specify the line
item to be protected.
AAR under BBA. Use Form 8082 if the
partnership representative (PR) (on behalf
of the partnership) is filing an AAR
electronically to adjust a previously e-filed
Form 1065. Also refer to the Instructions
for Form 1065.
BBA created a new centralized
partnership audit regime generally
effective for partnership tax years
beginning after 2017, replacing the
consolidated audit proceedings under
sections 6221 through 6234 enacted by
TEFRA. All partnerships with tax years
beginning after 2017 are subject to the
centralized partnership audit regime
unless they make a valid election under
section 6221(b). See section 6221(b) and
the Instructions for Form 1065 for
information on which partnerships are
eligible to make this election.
Future Developments
Use Form 8082 to notify the IRS of any
inconsistency between your tax treatment
of an item and the way the pass-through
entity treated and reported the same item
on its return. Also use the form to notify
the IRS if you did not receive
For the latest information about
developments related to Form 8082 and
its instructions, such as legislation
enacted after they were published, go to
Schedule K-1, Schedule Q, or a foreign
trust statement from the foreign trust by
the due date for filing your return
Reminders
Bipartisan Budget Act of 2015 (BBA).
BBA created a new centralized
(including extensions). However, for tax
years beginning before 2018, don’t file
Form 8082 as a partner in an ELP.
Instead, you must report all partnership
items in a manner consistent with the way
the partnership reported them on
partnership audit regime generally
effective for partnership tax years
beginning after 2017. The Tax Equity and
Fiscal Responsibility Act of 1982 (TEFRA)
generally applied to tax years beginning
before 2018. BBA repealed TEFRA and
the electing large partnership (ELP) rules.
Consequently, former ELPs are now
treated as other partnerships under the
BBA regime.
Schedule K-1 (Form 1065-B, U.S. Return
of Income for Electing Large
Partnerships).
AAR under TEFRA. Form 8082 is also
used if you are filing an AAR electronically
to correct a previously e-filed Form 1065,
U.S. Return of Partnership Income. An
AAR is:
Election into BBA for tax years
beginning before 2018. Certain
For purposes of these instructions
(unless otherwise noted), the centralized
partnership audit regime proceedings
under sections 6221 through 6241 will be
referred to as “BBA proceedings.”
partnerships may elect to have the new
centralized partnership audit regime apply
to a return filed for an eligible tax year
when filing an Administrative Adjustment
Request (AAR). See AAR with Election
Regime under BBA, later, for information
on how to make the election. An election
can also be made upon notification of an
audit. See Regulations section
A request by the tax matters partner
•
(TMP) to correct items on the original
partnership return;
A request by a TEFRA partner (other
•
Definitions
than a partner in an ELP), or residual
interest holder to correct pass-through
items on that person's income tax return;
or
TEFRA partnership. The consolidated
audit proceedings of sections 6221
through 6234 (prior to amendment by
BBA) are referred to as “TEFRA
A request by an ELP to correct items on
•
the original TEFRA partnership return.
proceedings”; partnerships that are
subject to TEFRA proceedings are
referred to as “TEFRA partnerships.” An
AAR filed by the TMP of the TEFRA
partnership is a TEFRA AAR. Any partner
in a TEFRA partnership may file an AAR
using Form 8082. TEFRA proceedings will
not apply to partnerships with tax years
beginning after 2017. A partnership with a
301.9100-22 for additional details.
Protective TEFRA AARs. Generally, a
protective AAR is a request for credit or
refund based on current litigation or
expected changes in tax law or other
legislation. The TMP or partner with
authority (PWA) files a protective AAR
when the right to a refund is contingent on
future events and may not be
General Instructions
Unless otherwise noted, references to
sections 6221 through 6241 are to Internal
Revenue Code sections as amended by
BBA.
Jan 06, 2021
Cat. No. 62051N
tax year beginning before 2018 that is not
subject to TEFRA proceedings is referred
to as a “nonTEFRA partnership.”
Pass-through entity. A partnership
(including an ELP), S corporation, estate,
trust, or REMIC.
partner is a pass-through entity that held
an interest in a BBA partnership at any
time during the reviewed year, which is the
partnership tax year to which the
BBA partnership. A partnership subject
to the centralized partnership audit regime
is a BBA partnership. All partnerships with
tax years beginning after 2017 are BBA
partnerships unless they make a valid
election out of the centralized partnership
audit regime. A partner in a BBA
partnership adjustment relates. For
example, if the BBA AAR is filed to make
an adjustment to income for the 2020 tax
year, 2020 is the reviewed year.
Item. Any item of a partnership, S
corporation, estate, trust, or REMIC
required to be taken into account for the
pass-through entity's tax year by the
partners, shareholders, beneficiaries,
owners, or residual interest holders of that
pass-through entity.
Tax matters partner (TMP). If the
partnership is subject to the TEFRA
procedures, it can designate a partner as
the TMP for the tax year for which the
return is filed. The TMP is a general
partner (in most cases, the TMP must also
be a U.S. person) designated by the
partnership to represent the partners in
the consolidated audit and litigation
proceedings under sections 6221 through
6234 (“TEFRA proceedings”). The
designation is made by completing the
Designation of Tax Matters Partner
section on Form 1065 used for tax years
beginning before 2018.
Additionally, a REMIC may designate a
TMP in the same manner in which a
partnership may designate a TMP under
Regulations section 301.6231(a)(7)-1.
When applying that section, treat all
holders of a residual interest in the REMIC
as general partners. The designation may
be made by completing the Designation of
Tax Matters Person section on page 3 of
Form 1066, U.S. Real Estate Mortgage
Investment Conduit (REMIC) Income Tax
Return, for tax years beginning before
2018.
For a limited liability company (LLC), a
member of the LLC is treated as a partner
and a member-manager is treated as a
general partner. A member-manager is
any owner of an interest in the LLC who,
alone or together with others, has
partnership is referred to as a “BBA
partner.” An AAR filed by a BBA
Schedule K-1. An annual schedule
reporting the partner's, shareholder's, or
beneficiary's share of income, deductions,
credits, etc., from a partnership, S
partnership is referred to as a “BBA AAR”
and must be filed by the PR.
Partnership representative (PR). If the
partnership is subject to the centralized
partnership audit regime, section 6223
provides that the partnership must
corporation, estate, or domestic trust.
Schedule Q. A quarterly schedule
reporting the residual interest holder's
share of taxable income or net loss from
the REMIC.
designate a partner or other person with a
substantial presence in the United States
as the PR who shall have the sole
Form 8985, Pass-Through State-
authority to act on behalf of the
ment —Transmittal/Partnership Ad-
justment Tracking Report. Form 8985
is used to summarize and transmit Forms
8986, Partner's Share of Adjustment(s) to
Partnership-Related Item(s), (by an
partnership. If the designated PR is an
entity, the partnership must also appoint a
designated individual to act on behalf of
the entity PR. The partnership and all
partners are bound by the actions of the
PR in dealings with the IRS under BBA.
audited partnership, a partnership filing an
AAR, or pass-through partner) in
NonBBA partnership. Under BBA,
certain partnerships with 100 or fewer
eligible partners for the tax year can elect
out of the centralized partnership audit
regime. Additional details regarding the
election out of the centralized partnership
audit regime can be found in the
situations where the partners are taking
into account the adjustments. Form 8985
is also used to report payments made and
related calculations by a pass-through
partner, if applicable. See the instructions
for these forms for further information.
Form 8986, Partner’s Share of Adjust-
ment(s) to Partnership-Related
Item(s). Form 8986 was created for
partnerships to show each partner’s share
of adjustments to PRI as a result of a BBA
audit or BBA AAR for situations where the
partners are taking into account the
adjustments.
Instructions for Form 1065. A partnership
that elects out of the centralized
partnership audit regime is referred to as a
“nonBBA partnership.”
Partnership-related items (PRIs). For
BBA partnerships, under section 6241(2)
(B), a PRI is any item or amount with
respect to the partnership that is relevant
in determining the income tax liability of
any person, without regard to whether the
item or amount appears on the
Foreign trust statement. Any of the
following annual statements furnished by a
foreign trust to its owners or beneficiaries.
Foreign Grantor Trust Owner
•
partnership's return. This includes an
imputed underpayment (IU) and an item or
amount relating to any transaction with,
basis in, or liability of the partnership.
Statement.
Foreign Grantor Trust Beneficiary
•
Statement.
Foreign Nongrantor Trust Beneficiary
•
continuing exclusive authority to make
management decisions necessary to
conduct the business for which the LLC
was formed. If there are no elected or
designated member-managers, each
owner is treated as a member-manager.
For details, see Regulations section
301.6231(a)(7)-2.
Partner with authority (PWA). Each
ELP must designate a partner (or other
person) as the PWA who shall have the
sole authority to act on behalf of the
partnership. See section 6255(b)(1) (prior
to amendment by BBA). If the partnership
fails to designate a PWA, the IRS can
select any partner to serve as the partner
with such authority. The PWA has the
authority to file an AAR on behalf of the
partnership. The PWA does this by filing
Form 8082.
Adjustment year. For BBA partnerships,
Statement.
the partnership tax year in which:
Who Must File
Notice of inconsistent treatment.
Generally, file Form 8082 if any of the
following apply.
In the case of an adjustment pursuant
•
to the decision of a court in a proceeding
brought under section 6234, such decision
becomes final;
In the case of an AAR under section
•
You believe an item was not properly
•
6227, such AAR is filed; or
In any other case, a notice of final
reported on the Schedule K-1 you
received from the partnership, or on a
Form 8986 received from an AAR
partnership (but not an audited
partnership), S corporation, estate, or
domestic trust; the Schedule Q you
received from the REMIC; or the foreign
trust statement you received from the
foreign trust.
•
partnership adjustment is mailed under
section 6231 or, if the partnership waives
the restrictions under section 6232(b)
(regarding limitations on assessments),
the waiver is executed by the IRS.
Reviewed year. For BBA partnerships,
the partnership’s tax year to which a
partnership adjustment relates.
Reviewed year pass-through partner.
For purposes of these instructions, under
the BBA, a reviewed year pass-through
You believe an item shown on your
•
schedule or statement is incorrect but it is
not an item that otherwise has to be
reported on your tax return. For example,
if you believe that the percentage shown
Instructions for Form 8082 (Rev. Jan. 2021)
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as your ownership of capital at the end of
the year was not properly reflected on
Schedule K-1, file Form 8082 to report
this, even though you are not otherwise
required to report that percentage on your
tax return. If you discover this kind of
inconsistency after filing your original
return, file an amended return to report it.
In the space provided on the amended
return for writing explanations, enter “See
attached Form 8082.” If the correction
does not affect your tax return, no
amounts need to be entered on the
amended return if the Form 8082 item is
the only reason for filing the amended
return.
that you don't report on your return
because the amount is otherwise limited
by law (such as a loss limited by the at-risk
or passive activity rules).
If you are a residual interest holder, and
•
all of the following apply.
° Your REMIC had no more than one
residual interest holder at any one
time during the tax year.
If you are a partner, and all of the
•
following apply.
° If at any time during the tax year the
REMIC had more than one residual
interest holder, each residual interest
holder was either an individual (other
than a nonresident alien), an estate, or
a C corporation.
° The tax year of the partnership
began prior to January 1, 2018.
° The partnership did not make an
early election into BBA.
° Your partnership had no more than
10 partners at any one time during the
tax year. A husband and wife (and
their estates) are treated as one
partner.
° The REMIC did not have an election
in effect under section 6231(a)(1)(B)
(ii) (prior to amendment by BBA) for
the tax year to have the consolidated
audit rules apply.
° Each partner was either an individual
(other than a nonresident alien) or an
estate of a deceased partner, or a C
corporation.
The pass-through entity has not filed a
•
If you are a partner in an ELP for tax
•
tax return or given you a Schedule K-1,
Schedule Q, or foreign trust statement by
the time you are required to file your tax
return (including extensions), and there
are items you must include on your return.
years before 2018. Partners must report
all partnership items consistently with their
treatment on the partnership return as
shown on Schedule K-1 (Form 1065-B).
Only the partnership may file an AAR.
° The partnership did not have an
election in effect under section
6231(a)(1)(B)(ii) (prior to amendment
by BBA) for the tax year to have the
TEFRA consolidated audit rules apply.
If you don't notify the IRS that you
Interest and Penalties
are reporting an item (Part I, line 1,
!
CAUTION
box a) inconsistently, any
If you disregard the requirements for filing
Form 8082, you may be subject to the
accuracy-related penalty under section
6662 or the fraud penalty under section
6663. Either penalty is in addition to any
tax that results from a computational
adjustment to make your amount or
treatment of the item consistent with the
amount or treatment of the item on the
pass-through entity's return.
If you are a BBA partnership, you may
•
deficiency (including any late filing or late
payment penalties applicable to the
deficiency) that results from an adjustment
to make your amount or other treatment of
the item consistent with the amount or
treatment of the item on the pass-through
entity's return, may be assessed
not file an AAR solely for the purpose of
changing the PR. See the Instructions for
Form 8979, Partnership Representative
Revocation, Designation, and
Resignation, for more information.
You may not file a BBA AAR after the
•
prescribed time to do so (see How and
When To File, later).
immediately. An inconsistent item can
exist on either your original or amended
return.
If you are a BBA partnership that has
•
received a notice of administrative
proceeding, you may not file an AAR.
Interest. Generally, interest is charged on
taxes not paid by the due date, even if an
extension of time to file is granted. Interest
is also charged on penalties imposed for
negligence, fraud, substantial valuation
misstatements, substantial
AAR under TEFRA. File Form 8082 if
If you are a partner and the BBA
•
any of the following apply.
partnership in which you are an investor
has received a notice of administrative
proceeding, a Form 8082 with respect to
inconsistent treatment of partnership items
from that BBA partnership cannot be filed.
You are requesting an administrative
•
adjustment to correct a previously filed
partnership return for a TEFRA
understatements of tax, and reportable
transaction understatements. The interest
is charged from the due date (including
extensions) to the date of payment. The
interest charge is figured at a rate
partnership. S corporations, estates, and
trusts cannot file an AAR (see Who May
Not File, later, for details).
A partner may not file an AAR on behalf
•
of the BBA partnership in which it is a
partner unless doing so is in its capacity
as the PR for that partnership.
You are a partner in a TEFRA
•
partnership (other than a partner in an
ELP) or residual interest holder in a
REMIC requesting an administrative
adjustment to correct pass-through items
on your income tax return.
determined under section 6621.
If you are a shareholder in an S
•
Late payment penalty. The penalty for
not paying the tax when due is usually 1/2
of 1% of the unpaid tax for each month or
part of a month that the tax remains
unpaid. The penalty cannot exceed 25%
of the unpaid tax.
Other penalties. Penalties can also be
imposed for negligence, substantial
understatements of tax, reportable
transaction understatements, and fraud.
See sections 6662, 6662A, and 6663.
corporation, except as a notice of
inconsistent treatment when the
shareholder's return is not consistent with
the return of the S corporation. Form 8082
cannot be filed by a shareholder to
request an administrative adjustment to
his or her tax return to correct S
corporation items. Instead, the
AAR under BBA. File Form 8082 if you
are the PR or designated individual
requesting an administrative adjustment to
correct a previously filed partnership
return on behalf of the BBA partnership.
shareholder must file an amended income
tax return.
When a partnership’s federal
return is changed for any reason,
it may affect its state return. For
TIP
If you are a beneficiary of an estate or
•
domestic trust, or a beneficiary or an
owner of a foreign trust, except as a notice
of inconsistent treatment when the
beneficiary's or owner's return is not
consistent with the return of the estate or
trust. Form 8082 cannot be filed by a
beneficiary or owner to request an
administrative adjustment to his or her tax
return to correct estate or trust items.
Instead, the beneficiary or owner must file
an amended income tax return.
more information, contact the state tax
agency with which the state return is filed.
Interest and penalties applicable to im-
puted underpayment (IU). Except
when the partnership elects to have its
partners take into account the
Who May Not File
adjustments, BBA partnership interest and
penalties are the following.
Don't use Form 8082 to file an AAR:
If you are a REMIC and want to correct
•
The interest figured with respect to any
•
items on the original REMIC return.
Instead, file Form 1065-X.
IU is the interest that would be determined
under chapter 67 for the period beginning
on the day after the return due date for the
reviewed year and ending on the return
For any amount of loss, deduction, or
•
credit from Schedule K-1, Schedule Q,
Form 8986, or the foreign trust statement
Instructions for Form 8082 (Rev. Jan. 2021)
-3-
due date for the adjustment year as
defined under section 6225(d)(2) or, if
earlier, the date the IU is paid.
• The last day for filing the
See the Instructions for Forms 8985 and
pass-through entity return for that year 8986 for more information.
(excluding extensions); and
If a request for an electronically
•
Any penalty, addition to tax, or
deposited refund of $1 million or more,
attach Form 8302, Electronic Deposit of
Tax Refund of $1 Million or More.
•
2. In the case of a TEFRA partnership
additional amount that is determined at the
partnership level is applied as if that BBA
partnership had been an individual subject
to tax under chapter 1 for the reviewed
year and the IU were an actual
or REMIC, before a notice of final
partnership administrative adjustment for
that year is mailed to the TMP or tax
matters person; or, in the case of an ELP,
before the mailing to the partnership of a
notice of partnership administrative
adjustment with respect to that year.
Judicial Review of an AAR (for
Returns Subject to the TEFRA
Procedures or ELPs)
underpayment (for understatement) for
that year for purposes of Part II of
If the IRS fails to act on an AAR, the TMP
or PWA may file a petition for judicial
review with the U.S. Tax Court, U.S. Court
of Federal Claims, or U.S. District Court.
The TMP or PWA must file the petition
before the date that is 2 years after the
date the TMP or PWA filed the AAR, but
not until after the date that is 6 months
from the date of such filing. The 2-year
period may be extended if the IRS and the
TMP or PWA agree in writing. For more
details, see sections 6228 (prior to
subchapter A or chapter 68.
3. In the case of a BBA partnership,
before a notice of an administrative
proceeding with respect to the tax year is
mailed under section 6231.
Election to apply the alternative to
payment of the IU. If the partners must
take into account the adjustments
because the BBA partnership filed an AAR
and there are adjustments that don't result
in an IU or if a BBA partnership elects the
alternative to payment of the IU under
sections 6227(b)(2) and 6226(c), interest
shall be determined:
A partnership return or a REMIC return
is generally due by the 15th day of the 3rd
month following the close of the
partnership's or REMIC's tax year. The tax
year of a REMIC always ends on
December 31.
At the partner level,
•
amendment by BBA) and 6252.
From the due date of the return for the
•
Special rules apply if the period of
limitations has been extended by
agreement and in the case of a TEFRA
AAR that relates to the deductibility of bad
debts or worthless securities. See
sections 6227 (prior to amendment by
BBA) and 6251 for details.
tax year to which the increase is
attributable (determined by taking into
account any increases attributable to a
change in tax attributes for a tax year
under section 6226(b)(2) until the date of
payment, and
Special Rules for ELPs for Tax
Years Beginning Before 2018
An ELP may file an AAR to adjust
partnership items. However, a partner may
not file an AAR. Generally, the ELP has
two choices for handling the adjustment.
At the section 6621(a)(2)
•
underpayment rate.
What To Attach
1. It can combine the adjustment with
the same partnership item for the year in
which the IRS allows the adjustment and
pass it through to the current partners for
that year. However, if the adjustment
involves a reduction in a credit that
exceeds the amount of that credit for the
partnership tax year in which the
If applicable, attach the following items to
Form 8082.
How Many Forms To Complete
You must complete and file a separate
form for each pass-through entity for
which you are reporting an inconsistent or
AAR item. If you are reporting more than
four inconsistent or AAR items from one
pass-through entity, use additional Forms
8082.
If the corrected amount involves an item
•
that must be supported with a schedule,
statement, or form, attach the appropriate
schedule, statement, or form. Include the
entity's name and employer identification
number (EIN) on any attachments. See
the Instructions for Forms 1065, 1065-B,
or 1066 (as applicable) for a list of forms
that may be required.
adjustment is allowed, the partnership
must pay tax in an amount equal to that
excess amount.
2. It may elect to not pass the
adjustment through to current partners by
paying tax on any IU that results from the
adjustment, as explained in section
6242(b)(4), prior to amendment by the
BBA.
How and When To File
If you file Form 8082 as a notice of
inconsistent treatment, complete a single
copy of the form, attach it to your tax
return, and file it when you file your original
return.
Note. If the attachments needed to
support the corrected amount include
copies of forms or schedules from
previously filed tax returns, write at the top
of each previously filed form or schedule,
“Copy Only—Don't Process.”
If a TMP, PR, or ELP files Form 8082
as an AAR on behalf of the partnership,
the TMP, PR, or ELP must file it with the
service center where the original return
was filed.
A BBA partnership must attach a
•
In either case, the partnership is liable
for any interest and penalties on the IU
that results from the adjustment. See
section 6242(b) for details. Interest is
figured on the IU for the period beginning
on the day after the due date (excluding
extensions) of the partnership return for
the adjusted year and ending on the due
date (excluding extensions) of the
schedule to the Form 8082 that supports
the position(s) reported. If the partnership
does not make an election under section
6227(b)(2) to have the adjustments taken
into account by the reviewed year partners
and would like to modify per section
6227(b)(1), it must attach a Form 8980,
Partnership Request for Modification of
Imputed Underpayments Under IRC
Section 6225(c), that supports any
If a partner in a TEFRA partnership or
residual interest holder files Form 8082 as
an AAR, it must be filed in duplicate. The
original copy is filed with the partner's or
residual interest holder's amended income
tax return, and the other copy is filed with
the service center where the pass-through
entity return is filed. See the Notice of
section under Part II of these instructions.
partnership return for the tax year the
adjustment takes effect (or the date the
partnership paid the tax due under (2)
above, if earlier). The adjusted year is
the partnership tax year in which the item
being adjusted arose.
modifications made to the IU as described
in sections 6225(b) and 6225(c) and as
applied to a BBA AAR under section
6227(b)(1). See the Form 8980
instructions paragraph titled “Modifications
to an Imputed Underpayment Included in
an Administrative Adjustment Request.”
How to file. Attach Form 8082 to an
amended Form 1065-B for the adjusted
year. Enter in the top margin of the
Generally, a pass-through entity may
file an AAR to change items on its return:
Attach Forms 8985 and 8986 as
•
1. Within 3 years after the later of:
amended return “See attached Form 8082
for AAR per IRC section 6251.” Be sure to
check box G(4) on page 1 of the amended
applicable. Form 8986 is used by BBA
partnerships to furnish and transmit each
partner’s share of adjustments to PRIs.
• The date on which the pass-through
entity return for that year is filed, or
Instructions for Form 8082 (Rev. Jan. 2021)
-4-
return. Identify in Part II of Form 8082 the
amount and treatment of any item the
partnership is changing from the way it
was reported on the original return. If the
partnership elects to pay the tax, enter it
on line 26 of page 1 of the amended Form
1065-B. don't enter any other amounts on
the amended Form 1065-B. Attach a
computation of the tax to Form 8082. The
IRS will bill the partnership for any interest
and penalties it owes.
If the income, deductions, credits, or
other information provided to any partner
on Schedule K-1 is incorrect, file an
amended Schedule K-1 (Form 1065-B) for
that partner(s) with Form 8082. Also give
the partner(s) a copy.
used, the partnership may prepare its own
statement with the following information.
described in section 6225(b). See section
6225(c), excluding paragraphs (2), (7),
and (9), for guidance regarding the
The partnership's name, taxpayer
•
identification number, and the partnership
tax year for which the election is being
made.
modification rules that may apply to an IU.
If modification is applied to an IU, the
AAR must include detailed documentation
to support all modifications made to the
IU.
If the partnership adjustment results in
an IU, the partnership must report and pay
the IU and any interest and penalty
associated with the IU at the time the AAR
is submitted. See Interest and penalties
above.
If modification of the rate used in
figuring the IU does not apply to the IU, the
IU will be figured using the highest rate in
effect under section 1 or 11 for the tax
year to which the adjustment relates. Write
“BBA Imputed Underpayment” in the
bottom margin of page 1 of Form 1065
and include the IU and any interest or
penalties related to the IU.
The name, taxpayer identification
•
number, address, and daytime telephone
number of the individual who signs the
statement.
Language indicating that the
•
partnership is electing application of
section 1101(c) of BBA for the partnership
return for the eligible tax year.
The information required to properly
•
designate the PR as defined by section
6223, which must include the name,
taxpayer identification number, address,
and daytime telephone number of the PR.
AAR With Election Into the
Centralized Partnership Audit
Regime Under BBA
The following representations must be
•
made on the statement of election:
1. The partnership is not insolvent and
does not reasonably anticipate becoming
insolvent before resolution of any
adjustment with respect to the partnership
tax year for which the election is being
made.
2. The partnership has not voluntarily
filed, and does not reasonably anticipate
filing, a petition for relief under title 11 of
the United States Code.
3. The partnership is not subject to,
and does not reasonably anticipate
becoming subject to, an involuntary
petition for relief under title 11 of the
United States Code.
4. The partnership has sufficient
assets, and reasonably anticipates having
sufficient assets, to pay a potential IU with
respect to the partnership tax year that
may be determined under subchapter C of
chapter 63 of the Internal Revenue Code
as amended by BBA.
Certain partnerships may elect to have the
new centralized partnership audit regime
apply to a return filed for an eligible tax
year when filing an AAR under section
6227. An eligible tax year is any tax period
beginning after November 2, 2015, and
before January 1, 2018. Only partnerships
can file an AAR under section 6227. A
partnership may not make this election
where:
If the partnership elects under section
6227(b)(2) to have the partners take the
adjustments into account or the
adjustments don't result in an IU, the
partnership is required to furnish
statements to each partner of the
partnership for the reviewed year, and file
statements with the AAR. See the
Instructions for Forms 8985 and 8986 for
more information.
An AAR has been filed on behalf of the
•
partnership under section 6227(c) (prior to
amendment by BBA), or
An amended return for the partnership
•
Filing an AAR electronically. If the
AAR is filed electronically, the partnership
uses Form 1065 and Form 8082 and
includes the statement “Election Under
Section 1101(g)(4),” if an election is being
made under section 1101(g)(4) of BBA.
has been filed. See Regulations section
301.9100-22(c)(4).
An AAR filed for an eligible tax year
before January 1, 2018, will be treated as
an AAR filed on behalf of a TEFRA
partnership or as an amended return filed
on behalf of a nonTEFRA partnership, as
applicable. An AAR filed after January 1,
2018, for an eligible tax year without a
statement attached to the AAR on which
the partnership makes the election into the
centralized partnership audit regime will
be treated as an AAR filed on behalf of a
TEFRA partnership or as an amended
return filed on behalf of a nonTEFRA
partnership, as applicable. Once made, an
election may only be revoked with the
consent of the IRS.
Specific Instructions
Specific instructions for most of the lines
have been provided. Lines that are not
explained are self-explanatory. If, after
reading the instructions, you are unable to
complete an item in Part I or Part II, enter
“See Part III” in the entry space for that
item and provide the information there.
A representation, signed under
•
penalties of perjury, that the individual
signing the statement is duly authorized to
make the election described in
Regulations section 301.9100-22 and that,
to the best of the individual's knowledge
and belief, all of the information contained
in the statement is true, correct, and
complete.
Note. If the pass-through entity did not file
a return or give you a Schedule K-1,
Schedule Q, or foreign trust statement by
the time you are required to file your
return, complete Parts I and II to the best
of your knowledge.
The statement must be signed and
•
dated by the TMP, as defined under
section 6231(a)(7) (prior to the
Note. An AAR filed with respect to a 2018
short tax period return by a partnership
that is subject to the centralized
amendment by BBA), and the applicable
regulations, or an individual who has the
authority to sign the partnership return for
the tax year. The fact that an individual
dates and signs the statement making the
election shall be prima facie evidence that
the individual is authorized to make the
election on behalf of the partnership.
partnership audit regime must meet the
requirements under section 6227.
Name and Identifying Number
Print or type the legal name of the entity
and identifying number on the appropriate
lines.
Making the election. To make the
election, the partnership must write across
the top of Form 1065 used to file the AAR,
“Election under Section 1101(g)(4)” and
attach a statement to the AAR. For the
statement requirement, the partnership
can use Form 7036, Election Under
Section 1101(g)(4) of the Bipartisan
Budget Act of 2015. If Form 7036 is not
Part I — General Information
Line 1
Imputed underpayment (IU).
Partnerships filing an AAR with an election
into the centralized partnership audit
regime under BBA will need to determine
if any partnership adjustment as defined
by section 6241(2) results in an IU as
Check box (a) if you believe an item was
not properly reported on the
Schedule K-1, Schedule Q, Form 8986
(only issued with respect to an AAR), or
Instructions for Form 8082 (Rev. Jan. 2021)
-5-
foreign trust statement you received, or
you have not received a Schedule K-1,
Schedule Q, or foreign trust statement by
the time you are required to file your tax
return (including extensions).
holders may file an amended return
requesting a refund. See section 6227(c)
(1) (prior to amendment by BBA).
If you are a TMP filing a TEFRA AAR
on behalf of the partnership and
requesting substituted return treatment,
attach a statement to Form 8082
indicating that you are requesting
substituted return treatment.
reflecting the partner’s share of the
adjustments (and should not provide
amended Schedule K-1). The partnership
is also required to file with the AAR all
Forms 8986 furnished to partners and
Form 8985. See the instructions for these
forms for further information.
Check box (b) if you are filing an AAR
on which you are requesting a change in
the amount or treatment of any item from
the way you reported it on your return as
originally filed or as you later amended it.
Item A. If the "Yes" box is checked,
complete Form 8979 and attach it to the
AAR. See the Instructions for Form 8979.
If the request is not treated as a
substituted return, the partners or residual
interest holders may file an amended
return requesting a refund. The IRS may
conduct an examination of the
Item B. BBA partnerships filing an
AAR will need to determine if the
Note. A partnership-partner that is also a
BBA partnership that is filing an AAR that
is inconsistent with a Schedule K-1 or
Form 8986 it received (only with respect to
an AAR) will check both boxes (a) and (b).
A partner (including a partnership-partner)
cannot file inconsistently with a Form 8986
it is issued with respect to an audited
partnership.
partnership adjustments result in an IU.
as to how to figure the IU. The BBA
partnership should consider all available
guidance issued by the IRS in making a
determination of whether or not the AAR
results in an IU. Also see IU Under the
later, for discussion of the IU.
pass-through entity’s return; or take no
action on the request. When a request is
not treated as a substituted return, the IRS
cannot assess tax without a deficiency or
entity level proceeding. See section
6227(c)(2) (prior to amendment by BBA).
In either case, if you are a TMP filing an
AAR electronically, file an amended Form
1065, but don't enter any amounts on the
form itself. Attach Form 8082 and identify
the amount and treatment of any item you
are changing from the way it was reported
on the original return. The TMP must sign
the amended return.
In 2020, an AAR can be filed by
partnerships subject to TEFRA
Note. An IU calculation must always be
made and presented on the AAR (even
when that IU is zero or less than zero or
the adjustments don't result in an IU). See
information.
proceedings (TEFRA AAR), partnerships
subject to BBA proceedings (BBA AAR),
and ELPs. An AAR can also be filed by the
following partners:
Partners of a TEFRA partnership;
Residual interest holders; or
Partnership-partners in a BBA
•
•
•
Attach amended Schedules K-1
showing the corrected amounts for each
partner.
Item C. If the adjustments contained in
the BBA AAR result in an IU, the
partnership (but only for the purpose of
providing notice of inconsistent treatment
with the AAR.) See section 301.6227–1(a)
referring to section 301.6222–1.
partnership must pay the IU at the same
time the AAR is filed. However, under
section 6227(b)(2), the partnership can
elect to have its reviewed year partners
take the adjustments into account. This is
an election to push out the adjustments to
the partners as alternative to payment of
the IU. See section 6226(a)(2) for details.
If this valid election is made, the
ELP AAR. The ELP procedures were
repealed for tax years beginning after
2017. However, ELPs filing an AAR after
2017 for a tax year that began before 2018
will use Form 8082.
For partnership tax years beginning
after 2017 and partnerships electing
into BBA for tax years beginning after
November 2, 2015, and before January
1, 2018.
For partnership tax years beginning
before January 1, 2018 (unless elect-
ing into BBA).
TEFRA AAR. The consolidated audit
proceedings of sections 6221 through
6234 (prior to amendment by BBA) are
referred to as “TEFRA proceedings.”
Partnerships that are subject to TEFRA
proceedings are referred to as “TEFRA
partnerships.” An AAR filed by the TMP of
the TEFRA partnership is a TEFRA AAR.
The Form 8082 is also used by any
partner in a TEFRA partnership filing an
AAR. TEFRA proceedings will not apply to
partnerships with tax years beginning after
2017. A partnership with a tax year
partnership is no longer liable for the IU.
If the adjustments in the BBA AAR
don't result in a positive IU or the BBA
partnership makes a valid election under
section 6227(b)(2), the partnership must
furnish to each partner of the partnership
for the reviewed year a Form 8986
reflecting the partner’s share of the
adjustments.
The partnership is also required to file
with the AAR all Forms 8986 furnished to
partners and Form 8985. See the
instructions for these forms for further
information.
BBA AAR. All partnerships with tax
years beginning after 2017 are subject to
the centralized partnership audit regime
unless an eligible partnership makes a
valid election under section 6221(b) to
elect out of the centralized partnership
audit regime.
Partnerships electing into BBA for tax
years beginning after November 2, 2015,
and before January 1, 2018, are also
subject to the centralized partnership audit
regime. Partnerships that are subject to
the centralized partnership audit
beginning before 2018 that is not subject
to TEFRA proceedings is referred to as a
“nonTEFRA partnership.”
Item D. Each reviewed year partner is
required to take into account its share of
adjustments requested in a BBA AAR if
the partnership adjustments result in an IU
and the partnership makes the alternative
to payment election discussed under Item
C. Additionally, each reviewed year
TEFRA partnerships requesting
substituted return treatment. A
procedures of sections 6221 through 6241
are referred to as “BBA partnerships.” A
partnership with a tax year beginning after
2017 that is not subject to BBA
substituted return requests that the
treatment of an item shown on the AAR be
substituted for the treatment of the item on
the pass-through entity's return. If the IRS
allows substituted return treatment, the
changes shown on the amended return
will be treated as corrections of
proceedings because it has made a valid
election under section 6221(b) is referred
to as a “nonBBA partnership.” An AAR
filed by a BBA partnership is a BBA AAR.
partner is required to take into account its
share of any adjustments requested in a
BBA AAR that don't result in an IU. The
determination of whether or not an
If a BBA partnership files an AAR and it
needs to make its partners aware of their
allocable share of adjustments, it will
furnish to each partner of the partnership
for the reviewed year a Form 8986,
mathematical or clerical errors, and the
IRS may assess any resulting tax to the
partners or residual interest holders
without a deficiency or entity level
adjustment results in an IU amount is
discussed in Item B for this section.
proceeding, or partners or residual interest
Instructions for Form 8082 (Rev. Jan. 2021)
-6-
The partnership is required to furnish
each reviewed year partner with a Form
8986 reporting its share of the BBA AAR
adjustments. The PR must attest to the
partnership’s compliance with this
a. File an amended Form 1065,
(checking box G5).
3. Figure an IU and determine if there
are any adjustments that don't result in an
IU.
b. The TMP must sign the amended
return.
4. Determine if you will pay the IU or
c. Attach amended Schedules K-1
showing the corrected amounts for
each partner.
push out the adjustments to the partners.
requirement. The PR will sign the Form
8082 under Item D to declare under
penalties of perjury that all statements
have been provided to the reviewed year
partners as required by these instructions.
a. If paying an IU, complete Form
1065 and report the IU appropriately.
Complete Forms 8985 and 8986
(pushout package) pertaining to the
adjustments that don't result in an IU
(if applicable).
4. File Form 8082 along with Form
1065 and attach any other supporting
documents required.
Item E. Under section 6227(b)(1), the
partnership may modify the IU resulting
from adjustments reported in a BBA AAR
in accordance with the provisions under
section 6225(c), disregarding the
5. Give a copy of the amended
Schedules K-1 to the applicable partners.
b. If pushing out all the adjustments to
the reviewed year partners, complete
Form 1065. Also complete Forms
8985 and 8986 (pushout package).
TEFRA partner filing an AAR. If a
partner in a TEFRA partnership is filing an
AAR to change items associated with its
investment in the TEFRA partnership that
were reported on its original return, do the
following.
provisions under paragraphs (2), (7), and
(9). Any modification made to the IU under
section 6227(b)(1) must be disclosed and
fully explained on Form 8980 included
with the AAR.
5. File Form 8082 along with Form
1065, and attach any other supporting
documents required, including copies of
Forms 8985 and 8986 (if applicable).
6. If applicable, distribute the Forms
8986 to reviewed year partners according
to the Form 8986 instructions.
1. Determine the required changes to
be made.
Note. If the partnership makes an election
to push out the adjustments to the
2. Complete Form 8082 to identify the
changes being made.
partners as an alternative to payment of
the IU, the modifications to the IU are
disregarded and are not included on the
statements provided to the partners.
Partner filing a notice of inconsistent
treatment for a Schedule K-1 received
from a BBA partnership. When a
partner receives a Schedule K-1 from a
BBA partnership, it must generally file
consistently with that Schedule K-1.
However, a partner may file inconsistently
if it provides valid notice to the IRS of
inconsistent treatment.
a. On Form 8082, check box (b) under
Part I, line 1.
how to complete columns (a) through
(e) of Part II.
Lines 2 through 6. Generally, the
information for these lines can be found on
Schedule K-1, Form 8986, Schedule Q, or
foreign trust statement.
3. Complete the applicable amended
return.
4. File Form 8082 along with the
applicable amended return and attach any
other supporting documents required.
Note. Complete these lines if you are
completing Form 8082 as a notice of
inconsistent treatment or as a partner in a
TEFRA partnership (other than a partner
in an ELP) or residual interest holder in a
REMIC requesting an administrative
adjustment to correct pass-through items
on your income tax return.
Notice of inconsistent treatment
filed with return. If a pass-through
partner does not receive a Schedule K-1
from a BBA partnership or does receive a
Schedule K-1 but disagrees with some or
all of the reported treatment and/or
amounts, it may file a notice of
Partner filing a notice of inconsistent
treatment for a Schedule K-1 received
from a TEFRA partnership. If a partner
does not receive a Schedule K-1 from a
TEFRA partnership or does receive a
Schedule K-1 but disagrees with some or
all of the reported treatment and/or
amounts, it may file a notice of
inconsistent treatment with its return
(original or amended/AAR). To do so, as a
pass-through partner you will include Form
8082 with your return (for example, Form
1065, Form 1120-S) and prepare your
return using the treatment and/or amounts
you determine are correct.
Line 6, tax year of pass-through
entity. If you are a partner filing a notice
of inconsistent treatment from a Form
8986 received as a result of a BBA
partnership AAR, use the date contained
in Part II, box D (“Review year of the
partnership”), from the Form 8986.
inconsistent treatment.
1. On Form 8082, check box (a) under
Part I, line 1.
how to complete columns (a) through (e)
of Part II.
3. File Form 8082 along with the
applicable return and attach any other
supporting documents required.
1. On Form 8082, check box (a) under
Part I, line 1 (and box (b), if applicable).
Part II — Inconsistent or
Administrative Adjustment
Request (AAR) Items
TEFRA partnerships and ELPs filing
AARs. If a TEFRA partnership/ELP is
filing an AAR to change items that were
reported on its original return, do the
following.
how to complete columns (a) through (e)
of Part II.
3. File Form 8082 along with the
applicable return and attach any other
supporting documents required.
BBA partnerships filing AARs. If a
BBA partnership is filing an AAR to
change items that were reported on its
original return, do the following.
Pass-through partner filing a notice of
inconsistent treatment for a Form 8986
received from a BBA partnership filing
an AAR. When a pass-through partner
receives a Form 8986 (“pushout
1. Determine the required changes to
1. Determine the required changes to
be made.
be made.
2. Complete Form 8082 to identify the
changes being made.
2. Complete Form 8082 to identify the
changes being made.
statement”) as a result of an AAR filed by
a BBA partnership in which it is an indirect
or direct investor, that pass-through
partner will (prior to the date contained in
box F of Part II on the Form 8986) take
one of the following actions.
a. On Form 8082, check box (b) under
a. On Form 8082, check box (b) under
Part I, line 1.
Part I, line 1.
how to complete columns (a) through
(e) of Part II.
how to complete columns (a) through
(e) of Part II.
3. Complete Form 1065.
Instructions for Form 8082 (Rev. Jan. 2021)
-7-
Push out all the adjustments that are on
b. Complete Form 8082. Attach the
completed Form 8082 and a copy of
the Form 8986 received to the Form
8985 (and Forms 8986, if applicable)
filed with the IRS.
not as a result of an audit), enter the
information from the first three columns of
the Form 8986, Part V, that you are
treating inconsistently.
•
the Form 8986 to its partners/
shareholders/beneficiaries.
For the adjustments resulting in an IU,
•
pay an IU on those adjustments and
prepare and issue to its partners/
shareholders/beneficiaries a pushout
statement package for those adjustments
that don't result in an IU.
Column (b).
c. In making the IU calculation for the
Form 8985, the adjustments should be
determined for each item (including
any item treated inconsistently) by
taking the difference between the
amount you previously reported and
the amount you are now reporting.
AAR. If you are filing an AAR, check
the box under “amount of item” if you are
changing the amount from what was
previously filed. Check the box under
“treatment of item” if you are reporting the
amount unchanged but are changing
another treatment of the item. Check both
boxes if you are changing the amount and
another treatment besides amount.
Note. Pass-through partners are not
permitted to apply modifications to the IU.
Where the Form 8986 only contains
•
adjustments that don't result in an IU,
prepare a pushout statement package for
those adjustments and issue to its
partners/shareholders/beneficiaries.
Note. The calculation described in
the preceding sentence is not the
same calculation as in column (e) of
Part II. If making a payment, do so
according to the Instructions for Forms
8985/8985–V.
Inconsistent treatment. If you
believe that the amount of any item shown
on Schedule K-1, Schedule Q, Form 8986
(as a result of a BBA AAR, and not as a
result of an audit), or foreign trust
statement was not properly reported,
check “Amount of item.”
If you believe that treatment of any item
(other than the amount of the item) was
not properly reported (such as a long-term
capital loss that a partner thinks should be
an ordinary loss), check “Treatment of
item.”
However, a pass-through partner may
file inconsistently if it provides valid notice
to the IRS of inconsistent treatment.
d. Additionally, for any of the
consistently and inconsistently treated
adjustments that don't result in an IU,
prepare a pushout package for
partners according to the Instructions
for Forms 8985 and 8986.
Note. Any partner that receives a Form
8986 as a result of an audit is not
permitted to treat items on that Form 8986
inconsistently and must report consistently
with the information provided on the Form
8986.
complete columns (a) through (e) of Part
II.
Notice of inconsistent treatment
filed with a Form 8985. A pass-through
partner receiving a Form 8986 (as a result
of a BBA partnership filing an AAR and not
as a result of an audit), may (prior to the
date contained in box F of Part II on the
Form 8986) file inconsistently from that
8986 if the pass-through partner provides
valid notice to the IRS of inconsistent
treatment. To provide a notice of
Other than pass-through partner filing
a notice of inconsistent treatment from
a BBA partnership. If you are a partner
(other than a pass-through partner) filing
inconsistently from a BBA partnership
(that is, inconsistently from either a
Schedule K-1 or a Form 8986 you
received as a result of a BBA partnership
filling an AAR, and not as a result of an
audit), complete Form 8082 and attach it
to your original return or amended return.
complete columns (a) through (e) of Part
II.
Check both parts of column (b) if either
1 or 2 below applies.
1. You believe that both the amount
and another treatment (besides the
amount) of the item shown on
Schedule K-1, Schedule Q, Form 8986 (as
a result of a BBA AAR, and not as a result
of an audit), or foreign trust statement
were not properly reported, or you believe
an item was omitted from the form; or
inconsistent treatment in these
circumstances as a pass-through partner,
do one of the following.
2. The pass-through entity did not file
a return or give you a Schedule K-1,
Schedule Q, or foreign trust statement.
1. Prepare a pushout package for all
adjustments (including any items that are
treated inconsistently as reported on the
Form 8082) in accordance with the
Lines 8 through 11.
Column (a).
Note. If you check only “Treatment of
item,” you don't need to complete columns
(d) and (e).
Instructions in the Forms 8985 and 8986.
a. Using all adjustments, whether
AAR. If you are filing an AAR, enter the
line number and description from the form
for which you are making the change. For
example, if you are changing the amount
reported on Schedule K, line 1, enter
“Schedule K, line 1.”
being treated consistently or
Column (c).
inconsistently, prepare a pushout
package for your partners,
AAR. If you are filing an AAR, report
the amount you previously reported for the
item listed in column (a).
shareholders, etc. according to the
instructions for Forms 8985 and 8986.
b. Complete Form 8082. Attach the
completed Form 8082 and a copy of
the Form 8986 received to the
pushout package (Forms 8985 and
8986) filed with the IRS.
Inconsistent treatment. If you attach
Form 8082 to your return, to make a notice
of inconsistent treatment, enter the
amount as shown on the Schedule K-1,
Schedule Q, or foreign trust statement you
received.
If the pass-through entity did not file a
return, or if you did not receive a schedule
or statement, or if you are reporting items
that you believe were omitted, enter zero
in column (c).
Inconsistent treatment. If you
received a Schedule K-1, Schedule Q,
Form 8986 (as a result of a BBA AAR, and
not as a result of an audit), or foreign trust
statement, enter the line number and
description shown on the form. Otherwise,
enter a complete description of the item.
2. Paying an IU for all adjustments
(including any items that are treated
inconsistently as reported on the Form
8082).
If you did not receive a Schedule K-1,
Schedule Q, or foreign trust statement but
are still reporting estimated amounts on
your original filing, enter a completed
description of the item and where you are
reporting the estimated amount on your
original return. For example, if you are a
BBA partnership-partner providing notice
of inconsistent treatment for a Form 8986
received (as a result of a BBA AAR, and
a. Prepare a Form 8985 (and Forms
8986 for partners, if applicable)
according to the instructions for Forms
8985 and 8986. The Form 8985
should be prepared using the
If you receive a Form 8986 as a result
of a BBA AAR (and not as a result of an
audit); to make a notice of inconsistent
treatment do the following.
adjustments that are being treated
both consistently and inconsistently.
Instructions for Form 8082 (Rev. Jan. 2021)
-8-
Pass-through partner preparing Form
computation of the IU amount. The BBA
partnership should consider all available
guidance issued by the IRS when figuring
interest and penalties. If making
•
8985. Attach a Form 8082 to the Form
8985 you file.
prepayments, the AAR should include
documentation that supports the
Other than pass-through partner. Attach the IU amount for an AAR. The IU amount
calculations. A payment made with the
Form 1065 should detail the portion of the
payment that is for the IU, the portion that
•
a Form 8082 to the copy of the return (or
should be reported on Form 1065, page 1,
line 25.
amended return) you file.
If the adjustments requested in the AAR is for prepaid estimated interest, and the
•
If treating any liabilities or capital items
reported to you on the Form 8986, Part IV
inconsistently, enter the item amount from
that Form 8986 as shown in the
result in an IU, generally the partnership
portion that is for prepaid estimated
must pay the IU. Adjustments requested in penalties. The total of all three should be
the AAR that don't result in an IU must be
taken into account by each reviewed year
partner as if the partnership had made an
election under section 6227(b)(2), but only
with regard to those adjustments that don't
result in an IU. In this instance, see Forms
8985 and 8986 and the related
reflected on Form 1065, page 1, line 25.
“Corrected” column from Part IV of that
form in column (c) of Form 8082.
Under section 6232(b), partnerships
filing a BBA AAR that have adjustments
that result in an IU, and don't elect the
alternative to payment of the IU (by not
electing to push out the adjustments to the
reviewed year partners), then the
If treating an item of income, gain, loss,
deduction, credits, or other items reported
to you on Form 8986, Part V
inconsistently, enter the sum of column (d)
and column (h) from Part V of that form in
column (c) of Form 8082.
instructions for reporting amounts not
included in the IU.
partnership must pay the IU, which should
be shown on Form 1065, page 1, line 25,
at the same time that the AAR is filed.
Information to include on the payment
made by check is the name of the
The partnership may elect under
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If treating any items reported to you on
the Form 8986, Part VI inconsistently,
enter that item amount from the Form
8986 in column (c) of Form 8082.
section 6227(b)(2) to have the reviewed
year partners take into account
adjustments resulting in an IU. If the
partnership makes the election, the
partnership is not liable for, nor required to
pay, the IU related to the adjustments.
Additionally, if the IU calculation results in
an amount that is zero or less than zero or
the adjustments don't result in an IU, then
all adjustments are taken into account by
the reviewed year partners. However, the
partnership may have withholding and
reporting obligations under chapter 3 or
chapter 4 with respect to the adjustments
taken into account by the reviewed year
foreign partners. See Forms 8985 and
8986 and their related instructions for how
to report these adjustments to reviewed
year partners.
partnership, “Form 1065,” the tax
identification number of the partnership,
the tax year, and “BBA AAR Imputed
Underpayment.” Checks must be payable
to “United States Treasury” and included
with the BBA AAR. If making an electronic
payment, choose the payment description
“BBA AAR Imputed Underpayment” from
the list of payment types.
Column (d).
Enter the amount you are reporting as
the correct amount in column (d).
Column (e).
Enter the net increase or decrease for
each line being changed in column (e).
Enter as a positive the amount by which
column (d) exceeds column (c) or enter as
a negative the amount by which column
(c) exceeds column (d). Use parentheses
around all amounts that are negative.
Explain the reason for the change
Figuring the IU
Definitions
Reallocation grouping. In general,
any adjustment that allocates or
(increase or decrease) in Part III.
reallocates a partnership-related item
(PRI) to and from a partner or partners is a
reallocation adjustment, except for an
adjustment to a credit or to a creditable
expenditure. Each reallocation adjustment
generally results in at least two separate
adjustments, each of which becomes a
separate subgrouping.
If the partnership elects under section
•
Part III — Explanations
6227(b)(2) to have its reviewed year
partners take all the adjustments into
account, all modifications by the
partnership (that would have been allowed
had the partnership paid an IU) are not
allowed and disregarded.
Explain in detail the reasons you are
reporting an inconsistent or corrected
amount/item as follows.
If you believe that the amount or other
•
type of treatment of any item shown on
Schedule K-1, Schedule Q, Form 8986 (as
a result of a BBA AAR, and not as a result
of an audit), or foreign trust statement was
not properly reported, state how you think
the item should be treated and why.
The partnership must always include an
•
Credit grouping. Any adjustment to a
PRI that is reported or could be reported
by a partnership as a credit on the
partnership’s return, including a
IU calculation, even when the IU is zero or
less than zero or the adjustments don't
result in an IU or the partnership elects
under section 6227(b)(2) to have its
reviewed year partners take all the
adjustments into account.
reallocation adjustment to such PRI, is
placed in the credit grouping.
If the pass-through entity has not filed a
•
tax return by the time you are required to
file your tax return, enter as the
Creditable expenditure grouping.
Any adjustment to a PRI where any
explanation, “Partnership (S corporation,
Estate, Trust, or REMIC) return not filed.”
Under section 6227(b)(1), the
partnership may modify the IU resulting
from adjustments reported in a BBA AAR
in accordance with the provisions under
section 6225(c), disregarding the
provisions under section 6225(c)(2), (7),
and (9). Any modification made to the IU
under section 6227(b)(1) must be
disclosed and fully explained in
person could take the item that is adjusted
(or item as adjusted if the item was not
originally reported by the partnership) as a
credit, including a reallocation adjustment
to a creditable expenditure, is placed in
the creditable expenditure grouping.
If the pass-through entity did not give
•
you a Schedule K-1, Schedule Q, or
foreign trust statement by the time you are
required to file your tax return, enter as the
explanation, “Schedule K-1 (Schedule Q,
or foreign trust statement) not received.”
Residual grouping. Any adjustment
to a PRI that doesn’t belong in the
reallocation, credit, or creditable
IU Under the Centralized
Partnership Audit Regime
BBA AARs must always include a
documentation included with the AAR. If
modifications are applied to the IU,
complete and attach Form 8980 and
report the modified IU amount on Form
1065, page 1, line 25.
expenditure grouping is placed in the
residual grouping. This grouping also
includes any adjustment to a PRI that
derives from an item that would not have
been required to be allocated by the
partnership to a partner under section
computation of the IU (even when the IU is
zero or less than zero or the adjustments
don't result in an IU), as determined under
section 6225(b). Documentation should be
included with the AAR that supports the
The applicability of interest and
penalties are discussed above. The BBA
AAR may include a prepayment for
Instructions for Form 8082 (Rev. Jan. 2021)
-9-
704(b), such as an adjustment to a liability
amount on the balance sheet.
the formula above requires an
into two separate subgroupings and will
not be netted together.
understanding of the concepts of
grouping, subgrouping, and netting. There
are seven steps necessary in figuring an
A creditable expenditure is treated in
•
Subgrouping. Each adjustment is
subgrouped according to how the
adjustment would be required to be taken
into account separately under section
702(a). In general, a subgrouping follows
the Schedule K/K-1 line items, including
any alpha codes related to a Schedule K-1
line item.
this manner even if the partners claimed a
IU. The first three steps focus on grouping, deduction in lieu of a credit.
subgrouping, and netting.
Each adjustment to a creditable
•
expenditure is subgrouped based upon
the separate category of income to which
the creditable expenditure relates and to
account for any different allocation of the
creditable expenditure between partners.
Two or more adjustments to creditable
expenditures are included within the same
subgrouping only if each adjustment
relates to creditable expenditures in the
same separate category, and each
Steps in Figuring the IU
Step 1—Grouping
Place each adjustment into one of four
groupings: reallocation, credit, creditable
expenditure, and residual groupings.
Negative adjustment. A negative
adjustment is any adjustment that is a
decrease in an item of gain or income, an
increase in an item of loss or deduction, or
an increase in an item of credit or
creditable expenditure.
Reallocation grouping. A
reallocation adjustment generally consists
of at least two adjustments, one positive
and one negative with each in a separate
subgrouping.
adjusted PRI would be allocated to the
partners in the same ratio had those items
been properly reflected on the originally
filed partnership return.
Net positive adjustment. An amount
that is greater than zero which results from
netting adjustments within a grouping or
subgrouping. A net positive adjustment
includes a positive adjustment that was
not netted with any other adjustment. A
net positive adjustment includes a net
decrease in an item of credit (or creditable
expenditure).
One part of the reallocation adjustment
•
Residual grouping. The residual
grouping contains all adjustments that
don't fit into one of the other groups.
reverses the effect of the improper
allocation of a PRI.
The other part of the adjustment makes
•
the proper allocation of the PRI.
Recharacterization adjustments. A
recharacterization adjustment will
Under the AAR rules, if one of the
•
reallocation adjustments is negative, such
negative adjustments must be pushed out
to the proper partner(s).
generally result in at least two separate
adjustments within the residual grouping.
Net negative adjustment. Any
amount which results from netting
adjustments within a grouping or
One adjustment reverses the improper
•
characterization of the PRI.
The other adjustment makes the proper
Don't net reallocation adjustments.
•
subgrouping that is not a net positive
adjustment. A net negative adjustment
includes a negative adjustment that was
not netted with any other adjustment.
As each part of a reallocation
!
characterization of the PRI.
CAUTION
adjustment is placed in a separate
The adjustments that result from a
•
subgrouping within the reallocation
grouping, those adjustments cannot be
netted in accordance with the netting
rules.
recharacterization are placed into
separate subgroupings.
Total netted partnership
adjustments (TNPA). The sum of all net
positive adjustments in the reallocation
grouping and the residual grouping.
Step 2—Subgrouping
Example. $100 of ordinary income is
being reallocated from Partner A to
Partner B. For purposes of figuring the IU,
there will be two adjustments, each in a
separate subgrouping: a negative
adjustment of $100 (reversing improper
allocation to Partner A) and a positive
adjustment of $100 (making proper
allocation to Partner B). These two
adjustments cannot be netted. As a result,
the total net positive adjustment in the
reallocation grouping is $100 and will be
included in the TNPA.
Determine if any adjustment, within one of
the four groupings, needs to be
Adjustments not resulting in an IU.
After grouping, subgrouping, and netting
the adjustments, the result of netting with
respect to any grouping or subgrouping
that includes a particular partnership
adjustment is a net negative adjustment or
the IU calculation results in an amount that
is zero or less than zero. Any adjustments
that don't result in an IU are taken into
account by the reviewed year partners in
accordance with Regulations section
301.6227-3.
subgrouped. Each adjustment is
subgrouped according to how the
adjustment would be required to be taken
into account separately under section
702(a). If any adjustment could be subject
to any preference, limitation, or restriction
under the Internal Revenue Code (or not
allowed, in whole or in part, against
ordinary income) if taken into account by
any person, the adjustment is placed in a
separate subgrouping from all other
adjustments within the grouping.
Credit grouping.
Generally, a decrease in credits is
•
Generally, each separate line item of
Schedule K/K-1 or return schedule (that is,
Schedule L, etc.) represents a separate
and distinct subgrouping.
Formula for Figuring the IU
treated as a positive adjustment, and an
increase in credits is treated as a negative
adjustment.
Figuring the IU
A reallocation adjustment relating to the
•
credit grouping is placed into two separate
subgroupings and will not be netted
together nor will they be netted with other
credit adjustments.
TNPA x rate* =
Example. Adjustments to ordinary
income must be placed in a different
subgrouping than capital gain income or
interest income since each of those items
is required to be separately stated under
section 702(a).
+ Sum of net positive
adjustments to
creditable expenditure
and credit groupings:
Creditable expenditure grouping.
= Total Imputed
Underpayment (IU)
Generally, a decrease in creditable
•
expenditures is treated as a positive
adjustment to credits, and an increase in
creditable expenditures is treated as a
negative adjustment.
Subgroupings generally reflect a line
•
item from Schedule K/K-1, including any
subcategories of those lines (for example,
alpha codes per the Schedule K-1
* Highest rate in effect for the reviewed year
under section 1 or 11.
A reallocation adjustment relating to a
•
instructions or activities broken out via
attached statements). If any line item on
Schedule K/K-1 or other schedules
The process of taking the adjustments
creditable expenditure grouping is placed
shown on the AAR and inputting them into
Instructions for Form 8082 (Rev. Jan. 2021)
-10-
consists of multiple items and the
components are required to be taken into
account separately under the Internal
Revenue Code, regulations, forms,
instructions, or other IRS guidance, then
such line item must be further
Positive adjustments may be netted
the calculation of the TNPA and is an
adjustment that does not result in an IU.
•
with other positive adjustments only if they
are in the same grouping. Negative
adjustments may be netted with other
For the credit grouping, a net positive
•
adjustment will increase the product of the
negative adjustments only if they are in the TNPA multiplied by the highest tax rate in
same grouping.
effect. A net negative adjustment,
including net negative adjustments
resulting from a credit reallocation
adjustment, will be treated as an
adjustment that does not result in an IU.
subgrouped.
Positive and negative adjustments may
•
only be netted against each other if they
are in the same subgrouping.
Example. 2019 Schedule K-1, box 13,
code A (cash contributions 60%), and
box 13, code B (cash contributions 30%),
are two separate subgroupings.
An adjustment in one grouping or
•
subgrouping may not be netted against an
adjustment in any other grouping or
subgrouping.
Step 7—Figure the IU Based on the
Results of Steps 4 Through 6 and
Insert Those Results Into the IU
Formula
The ordinary income/(loss) amount
•
reflected on line 1 of Schedule K and
box 1 of Schedule K-1 is sourced from
Form 1065, page 1, and is a net amount
consisting of various page 1 line items of
income and expenses. Although those
separate page 1 line items are distinct
items of income and expense, if they are
appropriately netted and included on line 1
of Schedule K and box 1 of Schedule K-1,
the net amount will be considered a single
subgrouping, unless such amount is
required to be separately allocated, such
as when the partnership has more than
one trade or business. If the partnership
has more than one trade or business
activity, the net income/(loss) from each
separate activity must be reported on
Schedule K-1. Each separate activity will
constitute a separate subgrouping and it
must be determined which activity an
adjustment to the page 1 item of income
and expense relates to for subgrouping
purposes.
All adjustments within a subgrouping
•
are netted to determine whether there is a
net positive adjustment or net negative
adjustment for that subgrouping.
Net positive adjustments from
•
Figuring the IU
subgroupings or positive adjustments
within a grouping (if subgroupings are
unnecessary) are netted to determine the
net positive adjustment for that grouping.
Net negative adjustments from
TNPA x rate* =
+ Sum of net positive
adjustments to
creditable expenditure
and credit groupings:
subgroupings within a grouping are netted
to determine the net negative adjustment
for that grouping.
= Total Imputed
Underpayment (IU)
* Highest rate in effect for the reviewed year
under section 1 or 11.
Step 4—Figure the Total Netted
Partnership Adjustment (TNPA)
Each net positive adjustment with
•
respect to a particular grouping or
subgrouping in the residual or reallocation
grouping that results after netting the
adjustments is included in the calculation
of the TNPA.
Paperwork Reduction Act
Notice
We ask for the information on this form to
carry out the Internal Revenue laws of the
United States. You are required to give us
the information. We need it to ensure that
you are complying with these laws and to
allow us to figure and collect the right
amount of tax.
If you have a negative adjustment along
•
Each net negative adjustment with
•
with a positive adjustment in the same line
item of Schedule K/K-1, you must
respect to a residual or reallocation
grouping or subgrouping that results after
netting the adjustments is excluded from
the calculation of the TNPA because those
adjustments don't result in an IU.
consider whether they may be properly
netted at the partnership level and
whether they are required to be taken into
account separately by any partner
You are not required to provide the
information requested on a form that is
subject to the Paperwork Reduction Act
unless the form displays a valid OMB
control number. Books or records relating
to a form or its instructions must be
retained as long as their contents may
become material in the administration of
any Internal Revenue law. Generally, tax
returns and return information are
because it may be subject to a limitation or
preference under the Internal Revenue
Code before you can place them in the
same subgrouping (for example, passive/
active for separate activities).
Step 5—Determine the Highest Tax
Rate in Effect Under Section 1 or
11 in the Reviewed Year
A negative adjustment that is not
•
otherwise required to be placed in its own
subgrouping must be placed in the same
subgrouping as another adjustment if the
negative adjustment and the other
Step 6—Determine the Sum of Net
Positive Adjustments to Creditable
Expenditure and Credit Groupings
That Will Increase the Product of
the TNPA Multiplied by the Highest
Rate in Effect
confidential, as required by section 6103.
The time needed to complete and file this
form will vary depending on individual
circumstances. The estimated burden for
individual taxpayers filing this form is
approved under OMB control number
1545-0074 and is included in the
adjustment would have been properly
netted at the partnership level and such
netted amount would have been required
to be allocated to the partners of the
partnership as a single item for purposes
of section 702(a) or other provision of the
Internal Revenue Code and regulations.
A net decrease to creditable
•
expenditures is treated as a net positive
adjustment to credits and increases the
product of the TNPA multiplied by the
highest tax rate in effect. A net increase to
creditable expenditures is treated as a net
negative adjustment that is excluded from
estimates shown in the instructions for
their individual income tax return.
Step 3—Netting
Net all adjustments within each of the
groupings and subgroupings.
Instructions for Form 8082 (Rev. Jan. 2021)
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