Monte Jackel Quoted in Tax Notes Today on Next Steps for Partnership Agreements
Tax Notes Today has quoted Akin Gump senior counsel Monte Jackel in the article “News Analysis: Next Steps for Partnerships Awaiting New Audit Regime,” regarding the uncertainty caused by President Trump’s ordering of a regulatory freeze. The article reports it has caused havoc for IRS and Treasury officials and left taxpayers unsure of how to draft or amend their partnership agreements.
Jackel pointed out that amending existing audit agreements to correspond to the Bipartisan Budget Act of 2015 (BBA) is an imprecise exercise, and taxpayers who have already done so tend to give general authority to the partnership representative because it is not yet possible to be specific. The prospect of not having to deal with an audit under the BBA for nearly three more years, he added, means that taxpayers lack motivation to spend a lot of time and money amending existing agreements.
One other potential issue with the implementation of the BBA, according to Jackel, is the prospect of tax reform along the lines of the outline proposed by the Trump administration. Under the outline, Jackel said, partnerships would need to separate net business income from investment income, passive income and other income.