Model Partnership Audit Law for States Soon to be Finalized

Model Partnership Audit Law for States Soon to be Finalized

The Multistate Tax Commission (MTC), an organization that develops uniform tax laws for states, will soon provide formal feedback to a coalition of industry groups finalizing a model statute regarding partnership audits.

Interested parties have proposed a model uniform statute and regulation and presented it to the MTC for its review.  The proposed model is designed to promote uniformity among states conforming with the new federal partnership audit regime, thereby aiding multistate entities with compliance. The interested parties hope that the MTC, which itself develops model acts, will give the model statute its blessing in time for the coalition to provide a final version to state lawmakers around the country by November, when some state legislative committees begin meeting. The new partnership audit regime, part of the Bipartisan Budget Act of 2015, takes effect Jan. 1, 2018.

The co-chair of the ABA State and Local Tax Committee task force said they are trying to create a “fair and balanced attempt at streamlining the reporting process for taxpayers while not depriving the states of the tax they are entitled to collect as a result of what we expect to be substantially increased IRS audits.”

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