7 and that if disproportionate allocations of items with respect to any partner are possible under the terms of the agreement, then the test has not been satisfied. We held: [F]or purposes of determining whether a partnership is a small partnership and whether the same share rule is satisfied, the test should be applied by determining whether the partnership reported more than one partnership item for the year and, if so, how those items were shared by each partner. This determination should be made by respondent as of the date of commencement of the audit of the partnership (but not necessarily on that date) by examining the partnership return and the corresponding Schedules K-1s, and any amendments thereto received prior to this date. * * * * * * * Because this section serves the limited purpose of determining to whom to issue a statutory notice or whether to issue an FPAA, and for the sake of judicial economy, we will not for these purposes permit a partner or representative of a partnership or respondent to claim a result other than that identified in the return and Schedules K-1s as filed and amended prior to the date of commencement of the partnership audit. Harrell v. Commissioner, 91 T.C. at 246-247; see also Z-Tron Computer Program v. Commissioner, 91 T.C. 258 (1988).4 In McKnight v. Commissioner, T.C. Memo. 1991-514, suppplemented by 99 T.C. 180 (1992), affd. 7 F.3d 447 (5th Cir. 4 We note that although Harrell v. Commissioner, supra, and Z- tron Computer Program v. Commissioner, supra, hold that one may not look behind the returns and Schedules K-1 for purposes of the same share requirement, each opinion provides a detailed examination of the partnership agreement and its provisions regarding the partners' distributive share. Moreover, we question whether this Court would be able to decide whether a specific allocation falls within the realm of sec. 704(c) or "similar principles" without looking to the partnership agreement or other supporting documents. See sec. 301.6231(a)(1)-1T(a)(3), Temporary Proced. & Admin. Regs.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Next
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