Crystal Beach Development of Destin Ltd. - Page 6




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          Partnership items are distinguished from affected items,                    
          which are defined in section 6231(a)(5) as any item to the extent           
          such item is affected by a partnership item. See White v.                   
          Commissioner, 95 T.C. 209, 211 (1990).  The first type of                   
          affected item gives rise to a computational adjustment without              
          the necessity of a partner-level proceeding.  The computational             
          adjustment is made to record the change in a partner's tax                  
          liability resulting from the proper treatment of partnership                
          items.  See sec. 6231(a)(6); White v. Commissioner, supra.  Once            
          partnership-level proceedings are completed, the Commissioner is            
          permitted to assess a computational adjustment against a partner            
          without issuing a notice of deficiency.  See sec. 6230(a)(1);               
          N.C.F. Energy Partners v. Commissioner, 89 T.C. 741, 744 (1987);            
          Maxwell v. Commissioner, supra at 792 n.9.                                  
          The second type of affected item is one that is dependent on                
          factual determinations to be made at the individual partner                 
          level.  See N.C.F. Energy Partners v. Commissioner, supra at 744.           
          Section 6230(a)(2)(A)(i) provides that the normal deficiency                
          procedures apply to those affected items that require partner-              
          level determinations.  Traditionally, additions to tax for                  
          negligence were considered affected items requiring factual                 
          determinations at the individual partner level.  See N.C.F.                 
          Energy Partners v. Commissioner, supra at 745; see sec.                     







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