rp-20-23.pdf

Preserve advance releases and the authoritative Internal Revenue Bulletin rendition; directory timestamps are file-publication metadata, not legal effective dates. HTML bulletins begin June 2003; earlier available issues require full PDF parsing.

This collection currently includes the publisher’s available advance-release directory. Historical bulletin renditions are discovered separately; an advance-release record alone does not certify the collection archive complete.

1

Part III

Administrative, Procedural, and Miscellaneous

26 CFR 601.601. Rules and regulations.
(Also Part I, §§ 6031, 6222, 6227.)

Rev. Proc. 2020-23

SECTION 1. PURPOSE

This revenue procedure allows eligible partnerships to file amended partnership
returns for taxable years beginning in 2018 and 2019 using a Form 1065, U.S. Return of
Partnership Income (Form 1065), with the “Amended Return” box checked, and issue
an amended Schedule K-1, Partner’s Share of Income, Deductions, Credits, etc.
(Schedule K-1), to each of its partners. The option to file amended returns only applies
to partnerships satisfying the requirements of section 3 of this revenue procedure.
SECTION 2. BACKGROUND
.01 Section 1101(a) of the Bipartisan Budget Act of 2015 (BBA), P.L. 114-74, Title XI
(November 2, 2015), replaced subchapter C of chapter 63 of subtitle F of the Internal
Revenue Code (Code) effective for partnership taxable years beginning after
December 31, 2017. Prior to the enactment of the BBA, subchapter C of chapter 63
contained the unified partnership audit and litigation rules enacted by the Tax Equity

2

and Fiscal Responsibility Act of 1982 (TEFRA), P.L. 97–248 (September 3, 1982), that
were commonly referred to as the TEFRA partnership procedures. Section 1101(c) of
the BBA replaced the TEFRA partnership procedures with a centralized partnership
audit regime that, in general, determines, assesses, and collects tax at the partnership
level. The centralized partnership audit procedures enacted by the BBA are found at
sections 6221 through 6241 of the Code. The centralized partnership audit procedures
apply to all partnerships, unless the partnership makes a valid election under section
6221(b) not to have those procedures apply. Partnerships subject to the centralized
partnership audit regime are referred to as BBA partnerships.
.02 Section 6031(a) of the Code requires every partnership to file a return for each
taxable year stating the items of its gross income and the deductions allowable by
subtitle A of the Code and such other information as required by forms and regulations,
including information about the partners in the partnership. For a partnership, the return
required by section 6031(a) is Form 1065, which includes Schedules K-1. Schedule K-1
reports the partner’s name, taxpayer identification number, and distributive share of
partnership-related items and other information related to the partner’s interest in the
partnership. Section 6031(b) requires that a partnership required to file a return under
section 6031(a) furnish a copy of the Schedule K-1 to each partner that includes such
information as may be required to be shown by regulations. In general, section 6031(b)
also prohibits BBA partnerships from amending the information required to be furnished
to their partners after the due date of the return, unless specifically provided by the
Secretary of the Treasury or his delegate. This revenue procedure exercises that

3

authority to allow a BBA partnership to file an amended partnership return and issue
amended Schedules K-1 under the circumstances described in this revenue procedure.
.03 Section 6222(a) of the Code requires partners in a BBA partnership to treat
partnership-related items, as defined in section 6241 and the corresponding regulations,
consistently on the partner’s return with how the BBA partnership treated such items on
its return. This consistency requirement generally applies to all partners. Consistent
treatment with the partnership generally requires that partners in a BBA partnership file
their returns consistent with the information reported to them on the Schedule K-1.
.04 The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), P.L. 116-
136, 134 Stat. 281 (March 27, 2020), provides retroactive tax relief that affects
partnerships, including relief for the taxable years ending in 2018, 2019, and, in some
cases, 2020. Without the option to file amended returns, as granted in section 3 of this
revenue procedure, BBA partnerships that already filed their Forms 1065 for the
affected years generally are unable to take advantage of the CARES Act relief for
partnerships except by filing Administrative Adjustment Requests (AARs) pursuant to
section 6227. Filing an AAR would result in the partners’ only being able to receive any
benefits from that relief on the current taxable year’s federal income tax return. Thus, if
an AAR were filed, the partners generally would not be able to take advantage of
CARES Act benefits from an AAR until they file their current year returns, which could
be in 2021. This process would significantly delay the relief provided in the CARES Act
intended to apply to the affected taxable years and provide an immediate benefit to
taxpayers.

4

.05 This revenue procedure allows BBA partnerships the option to file an amended
return instead of an AAR, though it does not prevent a partnership from filing an AAR to
obtain the benefits of the CARES Act or any other tax benefits to which the partnership
is entitled. A BBA partnership that files an amended return pursuant to this revenue
procedure is still subject to the centralized partnership audit procedures enacted by the
BBA.
SECTION 3. OPTION PROVIDED TO ELIGIBLE BBA PARTNERSHIPS FOR THE
2018 AND 2019 TAXABLE YEARS
.01 Scope. The filing and furnishing option provided by section 3.02 of this revenue
procedure applies to BBA partnerships described in section 3.03 of this revenue
procedure for the taxable years described in section 3.04 of this revenue procedure.
.02 Option to file amended return. BBA partnerships that filed a Form 1065 and
furnished all required Schedules K-1 for the taxable years beginning in 2018 or 2019
prior to the issuance of this revenue procedure may file amended partnership returns
and furnish corresponding Schedules K-1 before September 30, 2020. The amended
returns may take into account tax changes brought about by the CARES Act as well as
any other tax attributes to which the partnership is entitled by law.
.03 Eligible BBA partnerships. The filing and furnishing option provided in section
3.02 of this revenue procedure is available only to BBA partnerships that filed Forms
1065 and furnished Schedules K-1 for the partnership taxable years beginning in 2018
or 2019 prior to the issuance of this revenue procedure. For purposes of section 6222,
the amended return replaces any prior return (including any AAR filed by the
partnership) for the taxable year for purposes of determining the partnership’s treatment

5

of partnership-related items. See section 4.03 of this revenue procedure for a special
rule regarding partnerships who have previously filed AARs for an affected taxable year.
.04 Eligible taxable years. The filing and furnishing option provided in this revenue
procedure applies only to partnership taxable years that began in 2018 or 2019.
SECTION 4. PROCEDURE
.01 Filing requirements. To take advantage of the option to file an amended return
provided by section 3 of this revenue procedure, a BBA partnership must file a Form
1065 (with the “Amended Return” box checked) and furnish corresponding amended
Schedules K-1. The BBA partnership must clearly indicate the application of this
revenue procedure on the amended return and write “FILED PURSUANT TO REV
PROC 2020-23” at the top of the amended return and attach a statement with each
Schedule K-1 sent to its partners with the same notation. The BBA partnership may file
electronically or by mail, but filing electronically may allow for faster processing of the
amended return.
.02 Special rule for BBA partnerships whose returns are under examination. If a BBA
partnership is currently under examination for a taxable year beginning in 2018 or 2019
and wishes to take advantage of the option to file an amended return provided by
section 3 of this revenue procedure, the partnership may only do so if the partnership
sends notice to the revenue agent coordinating the partnership’s examination in writing
that the partnership seeks to use the amended return option described in this revenue
procedure prior to or contemporaneously with filing the amended return as described in
section 4.01 of this revenue procedure. The partnership must also provide the revenue
agent with a copy of the amended return upon filing.

6

.03 Special rule for BBA partnerships who have previously filed an AAR. If a BBA
partnership has previously filed an AAR and wishes to file an amended return pursuant
to this revenue procedure for the same taxable year, the partnership should use the
items as adjusted in the AAR, where applicable, in lieu of any reporting from the
originally filed partnership return.
.04 Coordination with Notice 2019-46. If, under Notice 2019-46, 2019-37 I.R.B. 695,
a partnership has applied the rules of the proposed GILTI regulations under proposed
§1.951A-5 for its taxable years ending before June 22, 2019 (Form 1065, Form 8992,
U.S Shareholder Calculation of Global Intangible Low-Taxed Income (GILTI), and
Schedules K-1), the partnership may continue to apply the rules of proposed §1.951A-5
for purposes of filing an amended Form 1065 for such taxable years under this revenue
procedure if the partnership furnishes amended Schedules K-1 consistent with those
proposed regulations and provides appropriate notifications to its partners under the
principles of section 5.01 of Notice 2019-46 within the period described in section 3.02
of this revenue procedure. Nothing in this revenue procedure changes a partnership’s
obligation to provide information described in section 5.02 of Notice 2019-46. If a
partnership applies the final GILTI regulations under §1.951A-1(e), any amended
Schedules K-1 issued under this revenue procedure must be consistent with those final
regulations.
SECTION 5. DRAFTING INFORMATION
The principal author of this revenue procedure is Joy E. Gerdy Zogby of the Office of
the Associate Chief Counsel (Procedure and Administration). For further information,
please contact 202-317-4927 (not a toll-free call).