Kligfeld Holdings, Kligfeld Corporation, Tax Matters Partner - Page 13

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          Kligfelds’ 2000 personal return reported affected items that                
          relate back to the partnership’s 1999 taxable year--i.e., the               
          computation of Kligfeld’s (and Corporation’s) outside basis which           
          then became the adjusted basis of the Inktomi stock distributed             
          and sold in 2000--the limitations period for making partnership             
          adjustments is still open.                                                  
               Holdings 1 and Holdings 2 were both partnerships under                 
          TEFRA--the Tax Equity and Fiscal Responsibility Act of 1982, Pub.           
          L. 97-248, 96 Stat. 324.  TEFRA partnerships are subject to                 
          special tax and audit rules.  See secs. 6221-6234.  Each TEFRA              
          partnership, for example, is supposed to designate a tax matters            
          partner (the TMP), to handle the partnership’s administrative               
          issues with the IRS and any resulting litigation.  (Corporation             
          is the TMP for Holdings 2.)16  TEFRA aims at determining all                
          partnership items--technically defined in section 6231(a)(3)--at            
          the partnership level; the goal is to have a single point of                
          adjustment for the IRS rather than having to make separate                  
          partnership item adjustments on each partner’s individual return.           
          See H. Conf. Rept. 97-760, at 599-601 (1982), 1982-2 C.B. 600,              
          662-63.  If the IRS decides to adjust any partnership items on a            

               16 Corporation, as TMP, is the petitioner in this case.                
          References to “Kligfeld’s arguments,” “Kligfeld’s position,” and            
          so forth are technically references to Corporation in this                  

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