9
the tax treatment of any partnership item (and the
applicability of any penalty, addition to tax, or
additional amount which relates to an adjustment to a
partnership item) shall be determined at the
partnership level.
In general, the Commissioner is precluded from assessing a
liability attributable to a partnership item or any penalty,
addition to tax, or additional amount which relates to the
partnership item, until after the completion of the partnership
level proceedings. Sec. 6225(a); Maxwell v. Commissioner, supra
at 788. Conversely, the Commissioner generally must follow the
deficiency procedures before he can assess a deficiency related
to affected items or other nonpartnership items. Sec. 6230(a);
Maxwell v. Commissioner, supra at 787-788.
If the Commissioner makes an adjustment to a partnership
item under section 6221 and a petition is filed with this Court
in accordance with section 6226(a) or (b), we have jurisdiction
to review the Commissioner’s adjustment to the partnership item.
The scope of our review is defined by section 6226(f) as follows:
A court with which a petition is filed in accordance
with this section shall have jurisdiction to determine
all partnership items of the partnership for the
partnership taxable year to which the notice of final
partnership administrative adjustment relates, the
proper allocation of such items among the partners, and
the applicability of any penalty, addition to tax, or
additional amount which relates to an adjustment to a
partnership item.
Thus, in a TEFRA proceeding, the Court has authority to
“determine all partnership items” and to determine “the proper
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Last modified: May 25, 2011