Revenue Procedure 2020-23 specifies that the amended returns may take into account both tax changes brought about by the CARES Act and any other tax attributes to which the partnership is legally entitled. Partnerships must file the amended returns and furnish the corresponding Schedules K-1 before September 30, 2020. Partnerships are eligible for the relief if they filed their Forms 1065 and furnished Schedules K-1 for partnership tax years beginning in 20, before the issuance of Revenue Procedure 2020-23.
Absent the relief being provided in this revenue procedure, a partnership wishing to take advantage of these provisions would be required to follow the BBA-AAR procedures, which could be very cumbersome and time-consuming in the current environment. To streamline and expedite partnerships' access to the benefits provided in the CARES Act, Revenue Procedure 2020-23 permits eligible partnerships to file amended returns for tax years beginning in 20. The new forms generally are to be used in accordance with the BBA-AAR procedures under IRC Section 6227 and the corresponding regulations. The IRS released the final forms required for BBA partnership AARs (Forms 89) in December 2019. Specifically, once the return due date (including extensions) for the partnership's tax return has passed, instead of filing an amended return with amended Schedules K-1, Partner's Share of Income, Deductions, Credits, a BBA partnership generally must file an administrative adjustment request (BBA-AAR) and additional forms required by the IRS. Instead, partnerships subject to the BBA rules must follow new procedures when making corrections to a Form 1065, U.S. Among other changes enacted by the BBA, IRC Section 6031(b) generally prohibits BBA partnerships from amending the information required to be furnished to its partners after the due date of the partnership's return. The BBA significantly altered the audit and income tax liability rules governing most partners and partnerships for tax years beginning after December 31, 2017.
As a result, BBA partnerships will be able to file amended partnership returns (Form 1065) for tax years beginning in 20 to take into account any benefits included in the Coronavirus Aid, Relief, and Economic Security (CARES) Act.īackground - BBA restrictions on amending partnership returns The IRS has released guidance ( Revenue Procedure 2020-23) granting an exception to the prohibition on filing amended partnership returns under the Bipartisan Budget Act of 2015 (BBA) centralized partnership audit regime. IRS issues guidance allowing BBA partnerships to amend 20 returns to access CARES Act provisions
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