8082 Instructions for Form 8082

Instructions for Form 8082

Department of the Treasury
Internal Revenue Service

(Rev. January 2023)

For use with Form 8082 (Rev. December 2018)
Notice of Inconsistent Treatment or
Administrative Adjustment Request (AAR)
Section references are to the Internal Revenue Code unless
otherwise noted.

expenses for the claim year. This may be done using Form
6765, Credit for Increasing Research Activities.

Contents

As part of the AAR process, the BBA partnership will also
submit Forms 8985 and 8986 to the IRS and send Forms 8986
to its partners. The BBA partnership is not required to provide
the five items of information again on the Forms 8985 and 8986.
The BBA partners do not need to attach the five items of
information to their original returns to which their Forms 8986 are
attached. For more information, see Research Credit Claims
(Section 41) on Amended Returns Frequently Asked Questions
at IRS.gov/businesses/corporations/research-credit-claimssection-41FAQ.

Reminders . . . . . . . . . . . . . . . . . . . . . . .
General Instructions . . . . . . . . . . . . . . . .
Purpose of Form . . . . . . . . . . . . . . . .
Definitions . . . . . . . . . . . . . . . . . . . .
Who Must File . . . . . . . . . . . . . . . . .
How and When To File . . . . . . . . . . .
Specific Instructions . . . . . . . . . . . . . . . .
Part I—General Information . . . . . . . .
Part II—Inconsistent or Administrative
Adjustment Request (AAR) Items . .
Part III—Explanations . . . . . . . . . . . .

Future Developments

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For the latest information about developments related to Form
8082 and its instructions, such as legislation enacted after they
were published, go to IRS.gov/Form8082.

Reminders
Bipartisan Budget Act of 2015 (BBA). BBA created a new
centralized partnership audit regime generally effective for
partnership tax years beginning after 2017. The Tax Equity and
Fiscal Responsibility Act of 1982 (TEFRA) generally applied to
tax years beginning before 2018. BBA repealed TEFRA and the
electing large partnership (ELP) rules. Consequently, former
ELPs are now treated as other partnerships under the BBA
regime.
Election into BBA for tax years beginning before 2018.
Certain partnerships may elect to have the new centralized
partnership audit regime apply to a return filed for an eligible tax
year when filing an Administrative Adjustment Request (AAR).
See AAR With Election Into the Centralized Partnership Audit
Regime Under BBA, later, for information on how to make the
election. An election can also be made upon notification of an
audit. See Regulations section 301.9100-22 for additional
details.
Increased research credit reported by a BBA
partnership. If an increased research credit is reported by a
BBA partnership, the BBA partnership does not file an amended
return. Instead, the BBA partnership must file an AAR and attach
the following five items of information to that AAR.
1. Identify all the business components to which the section
41 research credit relates for that tax year.
2. For each business component, identify all research
activities performed.
3. Name the individuals who performed each research
activity.
4. The information each individual sought to discover.
5. The total qualified employee wage expenses, total
qualified supply expenses, and total qualified contract research

Oct 12, 2022

General Instructions

Unless otherwise noted, references to sections 6221 through
6241 are to Internal Revenue Code sections as amended by
BBA.

Purpose of Form
Notice of inconsistent treatment. If you are a partner in a
TEFRA or BBA partnership, S corporation shareholder,
beneficiary of an estate or trust, owner of a foreign trust, or
residual interest holder in a real estate mortgage investment
conduit (REMIC), you must generally report items consistent
with the way they were reported to you on Schedule K-1,
Schedule K-3, Schedule Q, and/or a foreign trust statement.
However, there may be reasons why you wish to report these
items differently. Use Form 8082 for this purpose.
Use Form 8082 to notify the IRS of any inconsistency
between your tax treatment of an item and the way the
pass-through entity treated and reported the same item on its
return. Also use the form to notify the IRS if you did not receive
Schedule K-1, Schedule Q, and/or a foreign trust statement from
the foreign trust by the due date for filing your return (including
extensions). Additionally, based upon the instructions for
Schedule K-2, if the pass-through entity was required to provide
a Schedule K-3 but did not, use Form 8082 to notify the IRS of
this. However, for tax years beginning before 2018, don’t file
Form 8082 as a partner in an ELP. Instead, you must report all
partnership items in a manner consistent with the way the
partnership reported them on Schedule K-1 (Form 1065-B),
Partner's Share of Income (Loss) From an Electing Large
Partnership.
AAR under TEFRA. Form 8082 is also used if you are filing an
AAR electronically to correct a previously e-filed Form 1065,
U.S. Return of Partnership Income. An AAR is:
• A request by the tax matters partner (TMP) to correct items on
the original partnership return;
• A request by a TEFRA partner (other than a partner in an
ELP), or residual interest holder, to correct pass-through items
on that person's income tax return; or
• A request by an ELP to correct items on the original TEFRA
partnership return.
Protective TEFRA AARs. Generally, a protective AAR is a
request for credit or refund based on current litigation or
expected changes in tax law or other legislation. The TMP or

Cat. No. 62051N

(REMIC) Income Tax Return, for tax years beginning before
2018.
For a limited liability company (LLC), a member of the LLC is
treated as a partner and a member-manager is treated as a
general partner. A member-manager is any owner of an interest
in the LLC who, alone or together with others, has continuing
exclusive authority to make management decisions necessary to
conduct the business for which the LLC was formed. If there are
no elected or designated member-managers, each owner is
treated as a member-manager. For details, see Regulations
section 301.6231(a)(7)-2.

partner with authority (PWA) files a protective AAR when the
right to a refund is contingent on future events and may not be
determinable until after the period for filing an AAR has expired.
Protective AARs are subject to AAR statutes set forth in sections
6227, 6228, and 6229 (prior to amendment by BBA).
If you are a TMP filing on behalf of the partnership, the
petition period described in section 6228 (prior to amendment by
BBA) can be extended by using Form 9248, Agreement to
Extend the Time to File a Petition for Adjustment by the Tax
Matters Partner With Respect to Partnership Items. A protective
AAR must clearly state that it is a protective AAR, alert the IRS to
the essential nature of the adjustment, and specify the line item
to be protected.

Partner with authority (PWA). Each ELP must designate a
partner (or other person) as the PWA who shall have the sole
authority to act on behalf of the partnership. See section 6255(b)
(1) (prior to amendment by BBA). If the partnership fails to
designate a PWA, the IRS can select any partner to serve as the
partner with such authority. The PWA has the authority to file an
AAR on behalf of the partnership. The PWA does this by filing
Form 8082.

AAR under BBA. Use Form 8082 if the partnership
representative (PR) (on behalf of the partnership) is filing an
AAR electronically to adjust a previously e-filed Form 1065. Also
refer to the Instructions for Form 1065.
BBA created a new centralized partnership audit regime
generally effective for partnership tax years beginning after
2017, replacing the consolidated audit proceedings under
sections 6221 through 6234 enacted by TEFRA. All partnerships
with tax years beginning after 2017 are subject to the centralized
partnership audit regime unless they make a valid election under
section 6221(b). See section 6221(b) and the Instructions for
Form 1065 for information on which partnerships are eligible to
make this election.
For purposes of these instructions (unless otherwise noted),
the centralized partnership audit regime proceedings under
sections 6221 through 6241 will be referred to as “BBA
proceedings.”

BBA partnership. A partnership subject to the centralized
partnership audit regime is a BBA partnership. All partnerships
with tax years beginning after 2017 are BBA partnerships unless
they make a valid election out of the centralized partnership
audit regime. A partner in a BBA partnership is referred to as a
“BBA partner.” An AAR filed by a BBA partnership is referred to
as a “BBA AAR” and must be filed by the PR.
Partnership representative (PR). If the partnership is subject
to the centralized partnership audit regime, section 6223
provides that the partnership must designate a partner or other
person with a substantial presence in the United States as the
PR who shall have the sole authority to act on behalf of the
partnership. If the designated PR is an entity, the partnership
must also appoint a designated individual to act on behalf of the
entity PR. The partnership and all partners are bound by the
actions of the PR in dealings with the IRS under BBA.

Definitions
TEFRA partnership. The consolidated audit proceedings of
sections 6221 through 6234 (prior to amendment by BBA) are
referred to as “TEFRA proceedings”; partnerships that are
subject to TEFRA proceedings are referred to as “TEFRA
partnerships.” An AAR filed by the TMP of the TEFRA
partnership is a TEFRA AAR. Any partner in a TEFRA
partnership may file an AAR using Form 8082. TEFRA
proceedings will not apply to partnerships with tax years
beginning after 2017. A partnership with a tax year beginning
before 2018 that is not subject to TEFRA proceedings is referred
to as a “nonTEFRA partnership.”

NonBBA partnership. Under BBA, certain partnerships with
100 or fewer eligible partners for the tax year can elect out of the
centralized partnership audit regime. Additional details regarding
the election out of the centralized partnership audit regime can
be found in the Instructions for Form 1065. A partnership that
elects out of the centralized partnership audit regime is referred
to as a “nonBBA partnership.”
Partnership-related items (PRIs). For BBA partnerships,
under section 6241(2)(B), a PRI is any item or amount with
respect to the partnership that is relevant in determining the
income tax liability of any person, without regard to whether the
item or amount appears on the partnership's return. This
includes an imputed underpayment (IU) and an item or amount
relating to any transaction with, basis in, or liability of the
partnership.

Pass-through entity. A partnership (including an ELP), S
corporation, estate, trust, or REMIC.
Item. Any item of a partnership, S corporation, estate, trust, or
REMIC required to be taken into account for the pass-through
entity's tax year by the partners, shareholders, beneficiaries,
owners, or residual interest holders of that pass-through entity.
Tax matters partner (TMP). If the partnership is subject to the
TEFRA procedures, it can designate a partner as the TMP for
the tax year for which the return is filed. The TMP is a general
partner (in most cases, the TMP must also be a U.S. person)
designated by the partnership to represent the partners in the
consolidated audit and litigation proceedings under sections
6221 through 6234 (“TEFRA proceedings”). The designation is
made by completing the Designation of Tax Matters Partner
section on Form 1065 used for tax years beginning before 2018.
Additionally, a REMIC may designate a TMP in the same
manner in which a partnership may designate a TMP under
Regulations section 301.6231(a)(7)-1. When applying that
section, treat all holders of a residual interest in the REMIC as
general partners. The designation may be made by completing
the Designation of Tax Matters Person section on page 3 of
Form 1066, U.S. Real Estate Mortgage Investment Conduit

Adjustment year. For BBA partnerships, the partnership tax
year in which:
• In the case of an adjustment pursuant to the decision of a
court in a proceeding brought under section 6234, such decision
becomes final;
• In the case of an AAR under section 6227, such AAR is filed;
or
• In any other case, a notice of final partnership adjustment is
mailed under section 6231 or, if the partnership waives the
restrictions under section 6232(b) (regarding limitations on
assessments), the waiver is executed by the IRS.
Reviewed year. For BBA partnerships, the partnership’s tax
year to which a partnership adjustment relates.
Reviewed year pass-through partner. For purposes of these
instructions, under BBA, a reviewed year pass-through partner is
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Instructions for Form 8082 (Rev. Jan. 2023)

a pass-through entity that held an interest in a BBA partnership
at any time during the reviewed year, which is the partnership tax
year to which the partnership adjustment relates. For example, if
the BBA AAR is filed to make an adjustment to income for the
2020 tax year, 2020 is the reviewed year.

you are required to file your tax return (including extensions),
and there are items you must include on your return.
• If the pass-through entity did not provide you Schedule K-3,
and it was required to do so according to the instructions for
Schedule K-2, use Form 8082 to notify the IRS of this.

Schedule K-1. An annual schedule reporting the partner's,
shareholder's, or beneficiary's share of income, deductions,
credits, etc., from a partnership, S corporation, estate, or
domestic trust.

If you don't notify the IRS that you are reporting an item
(Part I, line 1, box a) inconsistently, any deficiency
CAUTION (including any late filing or late payment penalties
applicable to the deficiency) that results from an adjustment to
make your amount or other treatment of the item consistent with
the amount or treatment of the item on the pass-through entity's
return may be assessed immediately. An inconsistent item can
exist on either your original or amended return.

!

Schedule K-2. An extension of Schedule K of Form 1065 used
to report items of international tax relevance from the operation
of a partnership.
Schedule K-3. An extension of Schedule K-1 of Form 1065
generally used to report to partners their share of the items
reported on Schedule K-2.

AAR under TEFRA. File Form 8082 if any of the following
apply.
• You are requesting an administrative adjustment to correct a
previously filed partnership return for a TEFRA partnership. S
corporations, estates, and trusts cannot file an AAR (see Who
May Not File, later, for details).
• You are a partner in a TEFRA partnership (other than a
partner in an ELP) or residual interest holder in a REMIC
requesting an administrative adjustment to correct pass-through
items on your income tax return.

Schedule Q. A quarterly schedule reporting the residual
interest holder's share of taxable income or net loss from the
REMIC.
Form 8985, Pass-Through Statement—Transmittal/Partnership Adjustment Tracking Report. Form 8985 is used to
summarize and transmit Forms 8986, Partner's Share of
Adjustment(s) to Partnership-Related Item(s), (by an audited
partnership, a partnership filing an AAR, or pass-through
partner) in situations where the partners are taking into account
the adjustments. Form 8985 is also used to report payments
made and related calculations by a pass-through partner, if
applicable. See the instructions for these forms for further
information.

AAR under BBA. File Form 8082 if you are the PR or
designated individual requesting an administrative adjustment to
correct a previously filed partnership return on behalf of the BBA
partnership.
When a partnership’s federal return is changed for any

TIP reason, it may affect its state return. For more

Form 8986, Partner’s Share of Adjustment(s) to Partnership-Related Item(s). Form 8986 was created for partnerships
to show each partner’s share of adjustments to PRI as a result of
a BBA audit or BBA AAR for situations where the partners are
taking into account the adjustments.

information, contact the state tax agency with which the
state return is filed.

Who May Not File

Don't use Form 8082 to file a Notice of Inconsistent Treatment or
an AAR if any of the following apply.
• If you are a REMIC and want to correct items on the original
REMIC return. Instead, file Form 1065-X.
• For any amount of loss, deduction, or credit from
Schedule K-1, Schedule K-3, Schedule Q, Form 8986, or the
foreign trust statement that you don't report on your return
because the amount is otherwise limited by law (such as a loss
limited by the at-risk or passive activity rules).
• If you are a partner, and all five of the following elements
apply.
° The tax year of the partnership began prior to January 1,
2018.
° The partnership didn’t make an early election into BBA.
° Your partnership had no more than 10 partners at any one
time during the tax year. A husband and wife (and their
estates) are treated as one partner.
° Each partner was either an individual (other than a
nonresident alien) or an estate of a deceased partner, or a C
corporation.
° The partnership didn’t have an election in effect under
section 6231(a)(1)(B)(ii) (prior to amendment by BBA) for
the tax year to have the TEFRA consolidated audit rules
apply.
• If you are a BBA partnership, you may not file an AAR solely
for the purpose of changing the PR. See the Instructions for
Form 8979, Partnership Representative Revocation,
Designation, and Resignation, for more information.
• You may not file a BBA AAR after the prescribed time to do so
(see How and When To File, later).
• If you are a BBA partnership that has received a notice of
administrative proceeding, you may not file an AAR.

Foreign trust statement. Any of the following annual
statements furnished by a foreign trust to its owners or
beneficiaries.
• Foreign Grantor Trust Owner Statement.
• Foreign Grantor Trust Beneficiary Statement.
• Foreign Nongrantor Trust Beneficiary Statement.

Who Must File
Notice of inconsistent treatment. Generally, file Form 8082 if
any of the following apply.
• You believe an item wasn’t properly reported on the
Schedule K-1 or Schedule K-3 you received from the
partnership, or on a Form 8986 received from an AAR
partnership (but not an audited partnership), S corporation,
estate, or domestic trust; the Schedule Q you received from the
REMIC; or the foreign trust statement you received from the
foreign trust.
• You believe an item shown on your schedule or statement is
incorrect but it is not an item that otherwise has to be reported on
your tax return. For example, if you believe that the percentage
shown as your ownership of capital at the end of the year wasn’t
properly reflected on Schedule K-1, file Form 8082 to report this,
even though you aren’t otherwise required to report that
percentage on your tax return. If you discover this kind of
inconsistency after filing your original return, file an amended
return to report it. In the space provided on the amended return
for writing explanations, enter “See attached Form 8082.” If the
correction doesn’t affect your tax return, no amounts need to be
entered on the amended return if the Form 8082 item is the only
reason for filing the amended return.
• The pass-through entity hasn’t filed a tax return or given you a
Schedule K-1, Schedule Q, or foreign trust statement by the time
Instructions for Form 8082 (Rev. Jan. 2023)

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• If you are a partner and the BBA partnership in which you are
an investor has received a notice of administrative proceeding, a
Form 8082 with respect to inconsistent treatment of partnership
items from that BBA partnership cannot be filed.
• A partner may not file an AAR on behalf of the BBA
partnership in which it is a partner unless doing so is in its
capacity as the PR for that partnership.
• If you are a shareholder in an S corporation, except as a
notice of inconsistent treatment when the shareholder's return is
not consistent with the return of the S corporation. Form 8082
cannot be filed by a shareholder to request an administrative
adjustment to his or her tax return to correct S corporation items.
Instead, the shareholder must file an amended income tax
return.
• If you are a beneficiary of an estate or domestic trust, or a
beneficiary or an owner of a foreign trust, except as a notice of
inconsistent treatment when the beneficiary's or owner's return is
not consistent with the return of the estate or trust. Form 8082
cannot be filed by a beneficiary or owner to request an
administrative adjustment to his or her tax return to correct
estate or trust items. Instead, the beneficiary or owner must file
an amended income tax return.
• If you are a residual interest holder, and all of the following
apply.
° Your REMIC had no more than one residual interest holder
at any one time during the tax year.
° If at any time during the tax year the REMIC had more than
one residual interest holder, each residual interest holder
was either an individual (other than a nonresident alien), an
estate, or a C corporation.
° The REMIC didn’t have an election in effect under section
6231(a)(1)(B)(ii) (prior to amendment by BBA) for the tax
year to have the consolidated audit rules apply.
• If you are a partner in an ELP for tax years before 2018.
Partners must report all partnership items consistently with their
treatment on the partnership return as shown on Schedule K-1
(Form 1065-B). Only the partnership may file an AAR.

• The interest figured with respect to any IU is the interest that
would be determined under chapter 67 for the period beginning
on the day after the return due date for the reviewed year and
ending on the return due date for the adjustment year as defined
under section 6225(d)(2) or, if earlier, the date the IU is paid.
• Any penalty, addition to tax, or additional amount that is
determined at the partnership level is applied as if that BBA
partnership had been an individual subject to tax under
chapter 1 for the reviewed year and the IU were an actual
underpayment (or understatement) for that year for purposes of
Part II of subchapter A of chapter 68.
Election to apply the alternative to payment of the IU. If the
partners must take into account the adjustments because the
BBA partnership filed an AAR and there are adjustments that
don't result in an IU or if a BBA partnership elects the alternative
to payment of the IU under sections 6227(b)(2) and 6226(c),
interest shall be determined:
• At the partner level;
• From the due date of the return for the tax year to which the
increase is attributable, determined by taking into account any
increases attributable to a change in tax attributes for a tax year
under section 6226(b)(2) until the date of payment; and
• At the section 6621(a)(2) underpayment rate.

How Many Forms To Complete

You must complete and file a separate form for each
pass-through entity for which you are reporting an inconsistent
or AAR item. If you are reporting more than four inconsistent or
AAR items from one pass-through entity, use additional Forms
8082.

How and When To File

Do not file Form 8082 by itself.
• If you file Form 8082 as a notice of inconsistent treatment,
complete a single copy of the form, attach it to your tax return,
and file it when you file your original return.
• If a TMP, PR, or ELP files Form 8082 as an AAR on behalf of
the partnership, the TMP, PR, or ELP must complete the form,
attach it to the partnership's amended tax return, and file it with
the service center where the original return was filed.
• If a partner in a TEFRA partnership or residual interest holder
files Form 8082 as an AAR, it must be filed in duplicate. The
original copy is filed with the partner's or residual interest
holder's amended income tax return, and the other copy is filed
with the service center where the pass-through entity return is
filed. See Notice of inconsistent treatment filed with return, later,
under Part II.

Interest and Penalties

If you disregard the requirements for filing Form 8082, you may
be subject to the accuracy-related penalty under section 6662 or
the fraud penalty under section 6663. Either penalty is in
addition to any tax that results from a computational adjustment
to make your amount or treatment of the item consistent with the
amount or treatment of the item on the pass-through entity's
return.

Interest. Generally, interest is charged on taxes not paid by the
due date, even if an extension of time to file is granted. Interest is
also charged on penalties imposed for negligence, fraud,
substantial valuation misstatements, substantial
understatements of tax, and reportable transaction
understatements. The interest is charged from the due date
(including extensions) to the date of payment. The interest
charge is figured at a rate determined under section 6621.

Generally, a pass-through entity may file an AAR to change
items on its return:
1. Within 3 years after the later of:
• The date on which the pass-through entity return for that
year is filed, or
• The last day for filing the pass-through entity return for that
year (excluding extensions); and
2. In the case of a TEFRA partnership or REMIC, before a
notice of final partnership administrative adjustment for that year
is mailed to the TMP or tax matters person; or, in the case of an
ELP, before the mailing to the partnership of a notice of
partnership administrative adjustment with respect to that year;
or
3. In the case of a BBA partnership, before a notice of an
administrative proceeding with respect to the tax year is mailed
under section 6231.

Late payment penalty. The penalty for not paying the tax when
due is usually 1/2 of 1% of the unpaid tax for each month or part
of a month that the tax remains unpaid. The penalty cannot
exceed 25% of the unpaid tax.
Other penalties. Penalties can also be imposed for negligence,
substantial understatements of tax, reportable transaction
understatements, and fraud. See sections 6662, 6662A, and
6663.
Interest and penalties applicable to imputed underpayment
(IU). Except when the partnership elects to have its partners
take into account the adjustments, BBA partnership interest and
penalties are the following.

A partnership return or a REMIC return is generally due by the
15th day of the 3rd month following the close of the partnership's
or REMIC's tax year. The tax year of a REMIC always ends on
December 31.
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Instructions for Form 8082 (Rev. Jan. 2023)

In either case, the partnership is liable for any interest and
penalties on the IU that results from the adjustment. See section
6242(b) for details. Interest is figured on the IU for the period
beginning on the day after the due date (excluding extensions)
of the partnership return for the adjusted year and ending on the
due date (excluding extensions) of the partnership return for the
tax year the adjustment takes effect (or the date the partnership
paid the tax due under (2) above, if earlier). The adjusted year
is the partnership tax year in which the item being adjusted
arose.

Special rules apply if the period of limitations has been
extended by agreement and in the case of a TEFRA AAR that
relates to the deductibility of bad debts or worthless securities.
See sections 6227 (prior to amendment by BBA) and 6251 for
details.

What To Attach

If applicable, attach the following items to Form 8082.
• If the corrected amount involves an item that must be
supported with a schedule, statement, or form, attach the
appropriate schedule, statement, or form. Include the entity's
name and employer identification number (EIN) on any
attachments. See the instructions for Forms 1065, 1065-B, or
1066 (as applicable) for a list of forms that may be required.
Note. If the attachments needed to support the corrected
amount include copies of forms or schedules from previously
filed tax returns, write at the top of each previously filed form or
schedule, “Copy Only—Don't Process.”
• A BBA partnership must attach a schedule to the Form 8082
that supports the position(s) reported. If the partnership doesn’t
make an election under section 6227(b)(2) to have the
adjustments taken into account by the reviewed year partners
and would like to modify per section 6227(b)(1), it must attach a
Form 8980, Partnership Request for Modification of Imputed
Underpayments Under IRC Section 6225(c), that supports any
modifications made to the IU as described in sections 6225(b)
and 6225(c) and as applied to a BBA AAR under section
6227(b)(1). See Modifications to an Imputed Underpayment
Included in an Administrative Adjustment Request in the Form
8980 instructions.
• Attach Forms 8985 and 8986, as applicable. Form 8986 is
used by BBA partnerships to furnish and transmit each partner’s
share of adjustments to PRIs. See the instructions for Forms
8985 and 8986 for more information.
• If the AAR is a request for an electronically deposited refund
of $1 million or more, attach Form 8302, Electronic Deposit of
Tax Refund of $1 Million or More.

How to file. Attach Form 8082 to an amended Form 1065-B for
the adjusted year. Enter in the top margin of the amended return,
“See attached Form 8082 for AAR per IRC section 6251.” Be
sure to check box G(4) on page 1 of the amended return. Identify
in Part II of Form 8082 the amount and treatment of any item the
partnership is changing from the way it was reported on the
original return. If the partnership elects to pay the tax, enter it on
line 26 of page 1 of the amended Form 1065-B. Don't enter any
other amounts on the amended Form 1065-B. Attach a
computation of the tax to Form 8082. The IRS will bill the
partnership for any interest and penalties it owes.
If the income, deductions, credits, or other information
provided to any partner on Schedule K-1 is incorrect, file an
amended Schedule K-1 (Form 1065-B) for that partner(s) with
Form 8082. Also give the partner(s) a copy.

AAR With Election Into the Centralized
Partnership Audit Regime Under BBA

Certain partnerships may elect to have the new centralized
partnership audit regime apply to a return filed for an eligible tax
year when filing an AAR under section 6227. An eligible tax year
is any tax period beginning after November 2, 2015, and before
January 1, 2018. Only partnerships can file an AAR under
section 6227. A partnership may not make this election where:
• An AAR has been filed on behalf of the partnership under
section 6227(c) (prior to amendment by BBA), or
• An amended return for the partnership has been filed. See
Regulations section 301.9100-22(c)(4).

Judicial Review of an AAR (for Returns Subject
to the TEFRA Procedures or ELPs)

An AAR filed for an eligible tax year before January 1, 2018,
will be treated as an AAR filed on behalf of a TEFRA partnership
or as an amended return filed on behalf of a nonTEFRA
partnership, as applicable. An AAR filed after January 1, 2018,
for an eligible tax year without a statement attached to the AAR
on which the partnership makes the election into the centralized
partnership audit regime will be treated as an AAR filed on
behalf of a TEFRA partnership or as an amended return filed on
behalf of a nonTEFRA partnership, as applicable. Once made,
an election may only be revoked with the consent of the IRS.

If the IRS fails to act on an AAR, the TMP or PWA may file a
petition for judicial review with the U.S. Tax Court, U.S. Court of
Federal Claims, or U.S. District Court. The TMP or PWA must
file the petition before the date that is 2 years after the date the
TMP or PWA filed the AAR, but not until after the date that is 6
months from the date of such filing. The 2-year period may be
extended if the IRS and the TMP or PWA agree in writing. For
more details, see sections 6228 (prior to amendment by BBA)
and 6252.

Special Rules for ELPs for Tax Years Beginning
Before 2018

Note. An AAR filed with respect to a 2018 short tax period
return by a partnership that is subject to the centralized
partnership audit regime must meet the requirements under
section 6227.

An ELP may file an AAR to adjust partnership items. However, a
partner may not file an AAR. Generally, the ELP has two choices
for handling the adjustment.
1. It can combine the adjustment with the same partnership
item for the year in which the IRS allows the adjustment and
pass it through to the current partners for that year. However, if
the adjustment involves a reduction in a credit that exceeds the
amount of that credit for the partnership tax year in which the
adjustment is allowed, the partnership must pay tax in an
amount equal to that excess amount.
2. It may elect to not pass the adjustment through to current
partners by paying tax on any IU that results from the
adjustment, as explained in section 6242(b)(4), prior to
amendment by BBA.

Instructions for Form 8082 (Rev. Jan. 2023)

Making the election. To make the election, the partnership
must write across the top of Form 1065 used to file the AAR,
“Election under Section 1101(g)(4)” and attach a statement to
the AAR. For the statement requirement, the partnership can use
Form 7036, Election Under Section 1101(g)(4) of the Bipartisan
Budget Act of 2015. If Form 7036 is not used, the partnership
may prepare its own statement with the following information.
• The partnership's name and taxpayer identification number
(TIN), and the partnership tax year for which the election is being
made.
• The name, TIN, address, and daytime telephone number of
the individual who signs the statement.
• Language indicating that the partnership is electing
application of section 1101(c) of BBA for the partnership return
for the eligible tax year.
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• The information required to properly designate the PR as
defined by section 6223, which must include the name, taxpayer
identification number, address, and daytime telephone number
of the PR.
• The following representations must be made on the statement
of election.
1. The partnership is not insolvent and doesn’t reasonably
anticipate becoming insolvent before resolution of any
adjustment with respect to the partnership tax year for which the
election is being made.
2. The partnership hasn’t voluntarily filed, and doesn’t
reasonably anticipate filing, a petition for relief under title 11 of
the United States Code.
3. The partnership is not subject to, and doesn’t reasonably
anticipate becoming subject to, an involuntary petition for relief
under title 11 of the United States Code.
4. The partnership has sufficient assets, and reasonably
anticipates having sufficient assets, to pay a potential IU with
respect to the partnership tax year that may be determined
under subchapter C of chapter 63 of the Internal Revenue Code,
as amended by BBA.
• A representation, signed under penalties of perjury, that the
individual signing the statement is duly authorized to make the
election described in Regulations section 301.9100-22 and that,
to the best of the individual's knowledge and belief, all of the
information contained in the statement is true, correct, and
complete.
• The statement must be signed and dated by the TMP, as
defined under section 6231(a)(7) (prior to amendment by BBA),
and the applicable regulations, or an individual who has the
authority to sign the partnership return for the tax year. The fact
that an individual dates and signs the statement making the
election shall be prima facie evidence that the individual is
authorized to make the election on behalf of the partnership.

Filing an AAR electronically. If the AAR is filed electronically,
and if an election is being made under section 1101(g)(4) of
BBA, the partnership uses Form 1065 and Form 8082 and
includes the statement “Election Under Section 1101(g)(4).”

Specific Instructions

Specific instructions for most of the lines have been provided.
Lines that aren’t explained are self-explanatory. If, after reading
the instructions, you are unable to complete an item in Part I or
Part II, enter “See Part III” in the entry space for that item and
provide the information there.
Note. If the pass-through entity didn’t file a return or give you a
Schedule K-1, Schedule K-3 (and according to the instructions
for Schedule K-2, the pass-through entity was required to
provide one to you), Schedule Q, and/or foreign trust statement
by the time you are required to file your return, complete Parts I
and II to the best of your knowledge.

Name and Identifying Number

Print or type the legal name of the entity and identifying number
on the appropriate lines.

Part I—General Information
Line 1
Check box (a) if you believe an item wasn’t properly reported on
the Schedule K-1, Schedule K-3, Schedule Q, Form 8986 (only
issued with respect to an AAR), and/or foreign trust statement
you received, or if you haven’t received a Schedule K-1,
Schedule K-3 (that the pass-through entity was required to
provide according to the instructions for Schedule K-2),
Schedule Q, or foreign trust statement by the time you are
required to file your tax return (including extensions).

Imputed underpayment (IU). Partnerships filing an AAR with
an election into the centralized partnership audit regime under
BBA will need to determine if any partnership adjustment as
defined by section 6241(2) results in an IU as described in
section 6225(b). See section 6225(c), excluding paragraphs (2),
(7), and (9), for guidance regarding the modification rules that
may apply to an IU.
If modification is applied to an IU, the AAR must include
detailed documentation to support all modifications made to the
IU.
Unless the partnership elects under section 6227(b)(2) to
have the partners take the adjustments into account, if the
partnership adjustment results in an IU, the partnership must
report and pay the IU and any interest and penalty associated
with the IU at the time the AAR is submitted. See Interest and
penalties applicable to imputed underpayment (IU), earlier.
Unless the calculation of the IU contains a permitted rate
modification per section 6225(c)(4), the IU will be figured using
the highest rate in effect under section 1 or 11 for the tax year to
which the adjustment relates. Write “BBA Imputed
Underpayment” in the bottom margin of page 1 of Form 1065
and include the IU and any interest or penalties related to the IU.
If the partnership elects under section 6227(b)(2) to have the
partners take the adjustments into account or there are
adjustments that don't result in an IU, the partnership is required
to furnish statements to each partner of the partnership for the
reviewed year, and file statements with the AAR. See the
instructions for Forms 8985 and 8986 for more information.

Check box (b) if you are filing an AAR on which you are
requesting a change in the amount or treatment of any item from
the way you reported it on your return as originally filed or as you
later amended it.
Note. A partnership-partner that is also a BBA partnership that
is filing an AAR that is inconsistent with a Schedule K-1,
Schedule K-3, and/or Form 8986 it received (only with respect to
an AAR) will check both boxes (a) and (b). A partner (including a
partnership-partner) cannot file inconsistently with a Form 8986
it is issued with respect to an audited partnership.
Subject to the particular filing rules, an AAR can be filed by
partnerships subject to TEFRA proceedings (TEFRA AAR),
partnerships subject to BBA proceedings (BBA AAR), and ELPs.
An AAR can also be filed by the following partners:
• Partners of a TEFRA partnership;
• Residual interest holders; or
• Partnership-partners in a BBA partnership (but only for the
purpose of providing notice of inconsistent treatment with the
AAR). See Regulations section 301.6227-1(a) referring to
Regulations section 301.6222-1. See Part II, later.
For partnership tax years beginning before January 1,
2018 (unless electing into BBA).
TEFRA AAR. The consolidated audit proceedings of sections
6221 through 6234 (prior to amendment by BBA) are referred to
as “TEFRA proceedings.” Partnerships that are subject to
TEFRA proceedings are referred to as “TEFRA partnerships.”
An AAR filed by the TMP of the TEFRA partnership is a TEFRA
AAR. The Form 8082 is also used by any partner in a TEFRA
partnership filing an AAR. TEFRA proceedings will not apply to
partnerships with tax years beginning after 2017. A partnership

Note. BBA partnerships must file an AAR instead of an
amended return and will not attach amended Schedules K-1 to
the AAR. See IRS.gov/BBAAAR for instructions for electronically
submitting a BBA AAR.
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Instructions for Form 8082 (Rev. Jan. 2023)

valid election under section 6227(b)(2) to have each reviewed
partner take its share of adjustments into account. See items B,
C, and D that follow.
Item A. If the "Yes" box is checked, complete Form 8979 and
attach it to the AAR. See the Instructions for Form 8979.
Item B. BBA partnerships filing an AAR will need to
determine if the partnership adjustments result in an IU. See
Figuring the IU, later, for information as to how to figure the IU.
The BBA partnership should consider all available guidance
issued by the IRS in making a determination of whether or not
the AAR results in an IU. Also see IU Under the Centralized
Partnership Audit Regime, later, for discussion of the IU.

with a tax year beginning before 2018 that is not subject to
TEFRA proceedings is referred to as a “nonTEFRA partnership.”
TEFRA partnerships requesting substituted return
treatment. A substituted return requests that the treatment of
an item shown on the AAR be substituted for the treatment of the
item on the pass-through entity's return. If the IRS allows
substituted return treatment, the changes shown on the
amended return will be treated as corrections of mathematical or
clerical errors, and the IRS may assess any resulting tax to the
partners or residual interest holders without a deficiency or entity
level proceeding, or partners or residual interest holders may file
an amended return requesting a refund. See section 6227(c)(1)
(prior to amendment by BBA).
If you are a TMP filing a TEFRA AAR on behalf of the
partnership and requesting substituted return treatment, attach a
statement to Form 8082 indicating that you are requesting
substituted return treatment.
If the request is not treated as a substituted return, the
partners or residual interest holders may file an amended return
requesting a refund. The IRS may conduct an examination of the
pass-through entity’s return, or take no action on the request.
When a request is not treated as a substituted return, the IRS
cannot assess tax without a deficiency or entity level
proceeding. See section 6227(c)(2) (prior to amendment by
BBA).
In either case, if you are a TMP filing an AAR electronically,
file an amended Form 1065, but don't enter any amounts on the
form itself. Attach Form 8082 and identify the amount and
treatment of any item you are changing from the way it was
reported on the original return. The TMP must sign the amended
return.
Attach amended Schedules K-1 showing the corrected
amounts for each partner.
ELP AAR. The ELP procedures were repealed for tax years
beginning after 2017. However, ELPs filing an AAR after 2017
for a tax year that began before 2018 will use Form 8082.

Note. An IU calculation must always be made and presented on
the AAR (even when that IU is zero or less than zero or the
adjustments don't result in an IU). See Figuring the IU, later,
under Part III for more information.
Item C. If the adjustments contained in the BBA AAR result in
an IU, the partnership must pay the IU at the same time the AAR
is filed. However, under section 6227(b)(2), the partnership can
elect to have its reviewed year partners take the adjustments
into account. This is an election to push out the adjustments to
the partners as alternative to payment of the IU. See section
6226(a)(2) for details. If this valid election is made, the
partnership is no longer liable for the IU.
If the adjustments in the BBA AAR don't result in a positive IU
or the BBA partnership makes a valid election under section
6227(b)(2), the partnership must furnish to each partner of the
partnership for the reviewed year a Form 8986 reflecting the
partner’s share of the adjustments.
The partnership is also required to file with the AAR all Forms
8986 furnished to partners and Form 8985. See the instructions
for these forms for further information.
Item D. Each reviewed year partner is required to take into
account its share of adjustments requested in a BBA AAR if the
partnership adjustments result in an IU and the partnership
makes the alternative to payment election discussed under Item
C above. Additionally, each reviewed year partner is required to
take into account its share of any adjustments requested in a
BBA AAR that don't result in an IU. The determination of whether
or not an adjustment results in an IU amount is discussed earlier
under Item B.
The partnership is required to furnish each reviewed year
partner with a Form 8986 reporting its share of the BBA AAR
adjustments. The PR must attest to the partnership’s compliance
with this requirement. The PR will manually sign the Form 8082
under Item D to declare under penalties of perjury that all
statements have been provided to the reviewed year partners as
required by these instructions. If filing electronically, Form 8082
should be attached as a PDF to Form 1065.
Item E. Under section 6227(b)(1), the partnership may modify
the IU resulting from adjustments reported in a BBA AAR in
accordance with the provisions under section 6225(c),
disregarding the provisions under paragraphs (2), (7), and (9).
Any modification made to the IU under section 6227(b)(1) must
be disclosed and fully explained on Form 8980 included with the
AAR.

For partnership tax years beginning after 2017 and partnerships electing into BBA for tax years beginning after
November 2, 2015, and before January 1, 2018.
BBA AAR. All partnerships with tax years beginning after
2017 are subject to the centralized partnership audit regime
unless an eligible partnership makes a valid election under
section 6221(b) to elect out of the centralized partnership audit
regime.
Partnerships electing into BBA for tax years beginning after
November 2, 2015, and before January 1, 2018, are also subject
to the centralized partnership audit regime. Partnerships that are
subject to the centralized partnership audit procedures of
sections 6221 through 6241 are referred to as “BBA
partnerships.” A partnership with a tax year beginning after 2017
that is not subject to BBA proceedings because it has made a
valid election under section 6221(b) is referred to as a “nonBBA
partnership.” An AAR filed by a BBA partnership is a BBA AAR.
If a BBA partnership files an AAR and it needs to make its
partners aware of their allocable share of adjustments, it will
furnish to each partner of the partnership for the reviewed year a
Form 8986 reflecting the partner’s share of the adjustments (and
should not provide amended Schedules K-1 or K-3). The
partnership is also required to file with the AAR any Forms 8986
required to be furnished to partners along with Form 8985. See
the instructions for these forms for further information.
The partnership will need to furnish such statements to make
its partners aware of their allocable share of adjustments when
(1) the adjustments in the BBA AAR result in an IU of zero or less
than zero or the adjustments don’t result in an IU, or (2) the
adjustments in the BBA AAR do result in an IU greater than zero
but (as an alternative to payment) the BBA partnership makes a
Instructions for Form 8082 (Rev. Jan. 2023)

Note. If the partnership makes an election to push out the
adjustments to the partners as an alternative to payment of the
IU, the modifications to the IU are disregarded and aren’t
included on the statements provided to the partners.
Lines 2 through 6. Generally, the information for these lines
can be found on Schedule K-1, Form 8986, Schedule Q, or the
foreign trust statement.
Line 6, Tax year of pass-through entity. If you are a
partner filing a notice of inconsistent treatment from a Form 8986
received as a result of a BBA partnership AAR, use the date
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package) pertaining to the adjustments that don't result in an
IU (if applicable).
b. If pushing out all the adjustments to the reviewed year
partners, complete Form 1065. Also complete Forms 8985
and 8986 (pushout package).
5. File Form 8082 along with Form 1065, and attach any
other supporting documents required, including copies of Forms
8985 and 8986 (if applicable).
6. If applicable, distribute the Forms 8986 to reviewed year
partners according to the Form 8986 instructions.

contained in Part II, box D (“Review year of the partnership”),
from the Form 8986.

Part II—Inconsistent or Administrative
Adjustment Request (AAR) Items
TEFRA partnerships and ELPs filing AARs. If a TEFRA
partnership/ELP is filing an AAR to change items that were
reported on its original return, do the following.
1. Determine the required changes to be made.
2. Complete Form 8082 to identify the changes being made.
a. On Form 8082, check box (b) under Part I, line 1.
b. See Lines 8 through 11, later, for how to complete
columns (a) through (e) of Part II.
3. Complete Form 1065.
a. File an amended Form 1065 (checking box G5).
b. The TMP must sign the amended return.
c. Attach amended Schedules K-1 showing the corrected
amounts for each partner.
4. File Form 8082 along with Form 1065 and attach any
other supporting documents required.
5. Give a copy of the amended Schedules K-1 to the
applicable partners.

Partner filing a notice of inconsistent treatment for a
Schedule K-1 and/or Schedule K-3 received from a BBA
partnership. When a partner receives a Schedule K-1 and/or
Schedule K-3 from a BBA partnership, it must generally file
consistently with that Schedule K-1 and/or Schedule K-3.
However, a partner may file inconsistently if it provides valid
notice to the IRS of inconsistent treatment.
Notice of inconsistent treatment filed with return. If a
pass-through partner doesn’t receive a Schedule K-1 and/or
Schedule K-3 (and the pass-through entity was required to
provide one to you according to the instructions for
Schedule K-2) from a BBA partnership or does receive a
Schedule K-1 and/or Schedule K-3 but disagrees with some or
all of the reported treatment and/or amounts, it may file a notice
of inconsistent treatment with its return (original or amended/
AAR). To do so, as a pass-through partner, you will include Form
8082 with your return (for example, Form 1065, Form 1120-S)
and prepare your return using the treatment and/or amounts you
determine are correct.
1. On Form 8082, check box (a) under Part I, line 1 (and box
(b), if applicable).
2. See Lines 8 through 11, later, for how to complete
columns (a) through (e) of Part II.
3. File Form 8082 along with the applicable return and
attach any other supporting documents required.

TEFRA partner filing an AAR. If a partner in a TEFRA
partnership is filing an AAR to change items associated with its
investment in the TEFRA partnership that were reported on its
original return, do the following.
1. Determine the required changes to be made.
2. Complete Form 8082 to identify the changes being made.
a. On Form 8082, check box (b) under Part I, line 1.
b. See Lines 8 through 11, later, for how to complete
columns (a) through (e) of Part II.
3. Complete the applicable amended return.
4. File Form 8082 along with the applicable amended return
and attach any other supporting documents required.

Pass-through partner filing a notice of inconsistent treatment for a Form 8986 received from a BBA partnership filing an AAR. When a pass-through partner receives a Form
8986 (“pushout statement”) as a result of an AAR filed by a BBA
partnership in which it is an indirect or direct investor, that
pass-through partner will (prior to the date contained in box F of
Part II on the Form 8986) take one of the following actions.
• Push out all the adjustments that are on the Form 8986 to its
partners/shareholders/beneficiaries.
• For the adjustments resulting in an IU, pay an IU on those
adjustments and prepare and issue to its partners/shareholders/
beneficiaries a pushout statement package for those
adjustments that don't result in an IU.

Partner filing a notice of inconsistent treatment for a
Schedule K-1 received from a TEFRA partnership. If a
partner doesn’t receive a Schedule K-1 from a TEFRA
partnership or does receive a Schedule K-1 but disagrees with
some or all of the reported treatment and/or amounts, it may file
a notice of inconsistent treatment.
1. On Form 8082, check box (a) under Part I, line 1.
2. See Lines 8 through 11, later, for how to complete
columns (a) through (e) of Part II.
3. File Form 8082 along with the applicable return and
attach any other supporting documents required.

Note. Pass-through partners aren’t permitted to apply
modifications to the IU.
• Where the Form 8986 only contains adjustments that don't
result in an IU, prepare a pushout statement package for those
adjustments and issue to its partners/shareholders/beneficiaries.
However, a pass-through partner may file inconsistently if it
provides valid notice to the IRS of inconsistent treatment.

BBA partnerships filing AARs. If a BBA partnership is filing
an AAR to change items that were reported on its original return,
do the following.
1. Determine the required changes to be made.
2. Complete Form 8082 to identify the changes being made.
a. On Form 8082, check box (b) under Part I, line 1.
b. See Lines 8 through 11, later, for how to complete
columns (a) through (e) of Part II.
3. Figure an IU and determine if there are any adjustments
that don't result in an IU.
4. Determine if you will pay the IU or push out the
adjustments to the partners.
a. If paying an IU, complete Form 1065 and report the IU
appropriately. Complete Forms 8985 and 8986 (pushout

Note. Any partner that receives a Form 8986 as a result of an
audit is not permitted to treat items on that Form 8986
inconsistently and must report consistently with the information
provided on the Form 8986.
Notice of inconsistent treatment filed with a Form 8985.
A pass-through partner receiving a Form 8986 (as a result of a
BBA partnership filing an AAR and not as a result of an audit)
may (prior to the date contained in box F of Part II on the Form
8986) file inconsistently from that 8986 if the pass-through
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Instructions for Form 8082 (Rev. Jan. 2023)

partner provides valid notice to the IRS of inconsistent treatment.
To provide a notice of inconsistent treatment in these
circumstances as a pass-through partner, do one of the
following.
1. Prepare a pushout package for all adjustments (including
any items that are treated inconsistently, as reported on the
Form 8082) in accordance with the instructions for Forms 8985
and 8986.
a. Using all adjustments, whether being treated consistently
or inconsistently, prepare a pushout package for your
partners, shareholders, etc., according to the instructions for
Forms 8985 and 8986.
b. Complete Form 8082. Attach the completed Form 8082
and a copy of the Form 8986 received to the pushout
package (Forms 8985 and 8986) filed with the IRS.
2. Pay an IU for all adjustments (including any items that are
treated inconsistently as reported on the Form 8082).
a. Prepare a Form 8985 (and Forms 8986 for partners, if
applicable) according to the instructions for Forms 8985 and
8986. The Form 8985 should be prepared using the
adjustments that are being treated both consistently and
inconsistently.
b. Complete Form 8082. Attach the completed Form 8082
and a copy of the Form 8986 received to the Form 8985
(and Forms 8986, if applicable) filed with the IRS.
c. In making the IU calculation for the Form 8985, the
adjustments should be determined for each item (including
any item treated inconsistently) by taking the difference
between the amount you previously reported and the
amount you are now reporting.
d. Additionally, for any of the consistently and inconsistently
treated adjustments that don't result in an IU, prepare a
pushout package for partners according to the instructions
for Forms 8985 and 8986.

Column (b).
AAR. If you are filing an AAR, check the box under “Amount
of item” if you are changing the amount from what was
previously filed. Check the box under “Treatment of item” if you
are reporting the amount unchanged but are changing another
treatment of the item. Check both boxes if you are changing the
amount and another treatment besides amount.
Inconsistent treatment. If you believe that the amount of
any item shown on Schedule K-1, Schedule K-3, Schedule Q,
Form 8986 (as a result of a BBA AAR, and not as a result of an
audit), and/or a foreign trust statement wasn’t properly reported,
check “Amount of item.”
If you believe that treatment of any item (other than the
amount of the item) wasn’t properly reported (such as a
long-term capital loss that a partner thinks should be an ordinary
loss), check “Treatment of item.”
Check both parts of column (b) if either (1) or (2) below
applies.
1. You believe that both the amount and another treatment
(besides the amount) of the item shown on Schedule K-1,
Schedule K-3, Schedule Q, Form 8986 (as a result of a BBA
AAR, and not as a result of an audit), and/or a foreign trust
statement weren’t properly reported, or you believe an item was
omitted from the form.
2. The pass-through entity didn’t file a return or give you a
Schedule K-1, Schedule K-3 (and the pass-through entity was
required to provide one to you according to the instructions for
Schedule K-2), Schedule Q, and/or foreign trust statement.
Note. If you check only “Treatment of item,” you don't need to
complete columns (d) and (e).
Column (c).
AAR. If you are filing an AAR, report the amount you
previously reported for the item listed in column (a).
Inconsistent treatment. If you attach Form 8082 to your
return, to make a notice of inconsistent treatment, enter the
amount as shown on the Schedule K-1, Schedule K-3,
Schedule Q, and/or foreign trust statement you received.
If the pass-through entity didn’t file a return, or if you didn’t
receive a schedule or statement, or if you are reporting items
that you believe were omitted, enter zero in column (c).
If you receive a Form 8986 as a result of a BBA AAR (and not
as a result of an audit); to make a notice of inconsistent
treatment, do the following.
• Pass-through partner preparing Form 8985. Attach a Form
8082 to the Form 8985 you file.
• Other than pass-through partner. Attach a Form 8082 to the
copy of the return (or amended return) you file.
If treating any liabilities or capital items reported to you on the
Form 8986, Part IV, inconsistently, enter the item amount from
that Form 8986 as shown in the “Corrected” column from Part IV
of that form in column (c) of Form 8082.
If treating an item of income, gain, loss, deduction, or credits,
or other items reported to you on Form 8986, Part V,
inconsistently, enter the sum of column (d) and column (h) from
Part V of that form in column (c) of Form 8082.
If treating any items reported to you on the Form 8986, Part
VI, inconsistently, enter that item amount from the Form 8986 in
column (c) of Form 8082.

See Lines 8 through 11 below for how to complete columns (a)
through (e) of Part II.
Other than pass-through partner filing a notice of inconsistent treatment from a BBA partnership. If you are a partner
(other than a pass-through partner) filing inconsistently from a
BBA partnership (that is, inconsistently from a Schedule K-1, a
Schedule K-3, and/or a Form 8986 you received as a result of a
BBA partnership filling an AAR, and not as a result of an audit),
complete Form 8082 and attach it to your original return or
amended return. See Lines 8 through 11 below for how to
complete columns (a) through (e) of Part II.
Lines 8 through 11.
Column (a).
AAR. If you are filing an AAR, enter the line number and
description from the form for which you are making the change.
For example, if you are changing the amount reported on
Schedule K, line 1, enter “Schedule K, line 1.”
Inconsistent treatment. If you received a Schedule K-1,
Schedule K-3, Schedule Q, Form 8986 (as a result of a BBA
AAR, and not as a result of an audit), and/or foreign trust
statement, enter the line number and description shown on the
form. Otherwise, enter a complete description of the item.
If you didn’t receive a Schedule K-1, Schedule K-3,
Schedule Q, and/or foreign trust statement but are still reporting
estimated amounts on your original filing, enter a completed
description of the item and where you are reporting the
estimated amount on your original return. For example, if you are
a BBA partnership-partner providing notice of inconsistent
treatment for a Form 8986 received (as a result of a BBA AAR,
and not as a result of an audit), enter the information from the
first three columns of the Form 8986, Part V, that you are treating
inconsistently.
Instructions for Form 8082 (Rev. Jan. 2023)

Column (d). Enter the amount you are reporting as the correct
amount in column (d).
Column (e). Enter the net increase or decrease for each line
being changed in column (e). Enter as a positive the amount by
which column (d) exceeds column (c) or enter as a negative the
amount by which column (c) exceeds column (d). Use
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parentheses around all amounts that are negative. Explain the
reason for the change (increase or decrease) in Part III.

to have its reviewed year partners take all the adjustments into
account.

Part III—Explanations

Under section 6227(b)(1), the partnership may modify the IU
resulting from adjustments reported in a BBA AAR in
accordance with the provisions under section 6225(c),
disregarding the provisions under section 6225(c)(2), (7), and
(9). Any modification made to the IU under section 6227(b)(1)
must be disclosed and fully explained in documentation included
with the AAR. If modifications are applied to the IU, complete
and attach Form 8980 and report the modified IU amount on
Form 1065, page 1, line 25.

Explain in detail the reasons you are reporting an inconsistent or
corrected amount/item as follows.
• If you believe that the amount or other type of treatment of any
item shown on Schedule K-1, Schedule K-3, Schedule Q, Form
8986 (as a result of a BBA AAR, and not as a result of an audit),
and/or a foreign trust statement wasn’t properly reported, state
how you think the item should be treated and why.
• If the pass-through entity hasn’t filed a tax return by the time
you are required to file your tax return, enter as the explanation,
“Partnership (S corporation, Estate, Trust, or REMIC) return not
filed.”
• If the pass-through entity didn’t give you a Schedule K-1,
Schedule K-3 (and the pass-through entity was required to
provide one to you according to the instructions for
Schedule K-2), Schedule Q, and/or foreign trust statement by
the time you are required to file your tax return, enter as the
explanation, “Schedule K-1 (Schedule K-3, Schedule Q, and/or
foreign trust statement) not received.”

The applicability of interest and penalties are discussed
above. The BBA AAR may include a prepayment for interest and
penalties. If making prepayments, the AAR should include
documentation that supports the calculations. A payment made
with the Form 1065 should detail the portion of the payment that
is for the IU, the portion that is for prepaid estimated interest, and
the portion that is for prepaid estimated penalties. The total of all
three should be reflected on Form 1065, page 1, line 25.
Under section 6232(b), partnerships filing a BBA AAR that
have adjustments that result in an IU, and don't elect the
alternative to payment of the IU (by not electing to push out the
adjustments to the reviewed year partners), must pay the IU,
which should be shown on Form 1065, page 1, line 25, at the
same time that the AAR is filed. Information to include on the
payment made by check is the name of the partnership, “Form
1065,” the TIN of the partnership, the tax year, and “BBA AAR
Imputed Underpayment.” Checks must be made payable to
“United States Treasury” and included with the BBA AAR. If
making an electronic payment, choose the payment description
“BBA AAR Imputed Underpayment” from the list of payment
types.

IU Under the Centralized Partnership Audit
Regime
BBA AARs must always include a computation of the IU (even
when the IU is zero or less than zero or the adjustments don't
result in an IU), as determined under section 6225(b).
Documentation should be included with the AAR that supports
the computation of the IU amount. The BBA partnership should
consider all available guidance issued by the IRS when figuring
the IU amount for an AAR. If the calculated IU amount results in
an amount greater than zero and the partnership does not elect
under section 6227(b)(2) to have its reviewed year partners take
the adjustments into account, the IU amount should be reported
on Form 1065, page 1, line 25.
• If the adjustments requested in the AAR result in an IU,
generally the partnership must pay the IU. Adjustments
requested in the AAR that don't result in an IU must be taken into
account by each reviewed year partner as if the partnership had
made an election under section 6227(b)(2), but only with regard
to those adjustments that don't result in an IU. In this instance,
see Forms 8985 and 8986 and the related instructions for
reporting amounts not included in the IU.
• When filing an AAR, the partnership may elect under section
6227(b)(2) to have the reviewed year partners take into account
adjustments resulting in an IU. If the partnership makes the
election, the partnership is not liable for, nor required to pay, the
IU related to the adjustments. Additionally, if the IU calculation
results in an amount that is zero or less than zero or the
adjustments don't result in an IU, then all adjustments are taken
into account by the reviewed year partners. However, the
partnership may have withholding and reporting obligations
under chapter 3 or chapter 4 with respect to the adjustments
taken into account by the reviewed year foreign partners. See
Forms 8985 and 8986 and their related instructions for how to
report these adjustments to reviewed year partners.
• If the partnership elects under section 6227(b)(2) to have its
reviewed year partners take all the adjustments into account, all
modifications by the partnership (that would have been allowed
had the partnership paid an IU) aren’t allowed and are
disregarded.

Figuring the IU
Definitions
Reallocation grouping. In general, any adjustment that
allocates or reallocates a PRI to and from a partner or partners is
a reallocation adjustment, except for an adjustment to a credit or
to a creditable expenditure. Each reallocation adjustment
generally results in at least two separate adjustments, each of
which becomes a separate subgrouping.
Credit grouping. Any adjustment to a PRI that is reported or
could be reported by a partnership as a credit on the
partnership’s return, including a reallocation adjustment to such
PRI, is placed in the credit grouping.
Creditable expenditure grouping. Any adjustment to a PRI
where any person could take the item that is adjusted (or item as
adjusted if the item wasn’t originally reported by the partnership)
as a credit, including a reallocation adjustment to a creditable
expenditure, is placed in the creditable expenditure grouping.
Residual grouping. Any adjustment to a PRI that doesn’t
belong in the reallocation, credit, or creditable expenditure
grouping is placed in the residual grouping. This grouping also
includes any adjustment to a PRI that derives from an item that
wouldn’t have been required to be allocated by the partnership
to a partner under section 704(b), such as an adjustment to a
liability amount on the balance sheet.
Subgrouping. Each adjustment is subgrouped according to
how the adjustment would be required to be taken into account
separately under section 702(a). In general, a subgrouping
follows the Schedule K/K-1/K-2/K-3 line items, including any
alpha codes related to a Schedule K-1/K-2/K-3 line item.
Negative adjustment. A negative adjustment is any
adjustment that is a decrease in an item of gain or income, an
increase in an item of loss or deduction, or an increase in an
item of credit or creditable expenditure.

Note. Regarding modifications, see Item E under Part I, earlier.
• The partnership must always include an IU calculation, even
when the IU is zero or less than zero or the adjustments don't
result in an IU or the partnership elects under section 6227(b)(2)
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Instructions for Form 8082 (Rev. Jan. 2023)

The process of taking the adjustments shown on the AAR
and inputting them into the formula shown in the previous table
requires an understanding of the concepts of grouping,
subgrouping, and netting. There are seven steps necessary in
figuring an IU. The first three steps focus on grouping,
subgrouping, and netting.

adjustment of $100 (reversing improper allocation to Partner A)
and a positive adjustment of $100 (making proper allocation to
Partner B). These two adjustments cannot be netted. As a result,
the total net positive adjustment in the reallocation grouping is
$100 and will be included in the TNPA.
Credit grouping.
• Generally, a decrease in credits is treated as a positive
adjustment, and an increase in credits is treated as a negative
adjustment.
• A reallocation adjustment relating to the credit grouping is
placed into two separate subgroupings and will not be netted
together nor will they be netted with other credit adjustments.
Creditable expenditure grouping.
• Generally, a decrease in creditable expenditures is treated as
a positive adjustment to credits, and an increase in creditable
expenditures is treated as a negative adjustment.
• A reallocation adjustment relating to a creditable expenditure
grouping is placed into two separate subgroupings and will not
be netted together.
• A creditable expenditure is treated in this manner even if the
partners claimed a deduction in lieu of a credit.
• Each adjustment to a creditable expenditure is subgrouped
based upon the separate category of income to which the
creditable expenditure relates and to account for any different
allocation of the creditable expenditure between partners. Two
or more adjustments to creditable expenditures are included
within the same subgrouping only if each adjustment relates to
creditable expenditures in the same separate category, and
each adjusted PRI would be allocated to the partners in the
same ratio had those items been properly reflected on the
originally filed partnership return.
Residual grouping. The residual grouping contains all
adjustments that don't fit into one of the other groups.
Recharacterization adjustments. A recharacterization
adjustment will generally result in at least two separate
adjustments within the residual grouping.
• One adjustment reverses the improper characterization of the
PRI.
• The other adjustment makes the proper characterization of
the PRI.
• The adjustments that result from a recharacterization are
placed into separate subgroupings.

Steps in Figuring the IU

Step 2—Subgrouping

Step 1—Grouping

Determine if any adjustment, within one of the four groupings,
needs to be subgrouped. Each adjustment is subgrouped
according to how the adjustment would be required to be taken
into account separately under section 702(a). If any adjustment
could be subject to any preference, limitation, or restriction
under the Internal Revenue Code (or not allowed, in whole or in
part, against ordinary income) if taken into account by any
person, the adjustment is placed in a separate subgrouping from
all other adjustments within the grouping.

Net positive adjustment. An amount that is greater than
zero which results from netting adjustments within a grouping or
subgrouping. A net positive adjustment includes a positive
adjustment that wasn’t netted with any other adjustment. A net
positive adjustment includes a net decrease in an item of credit
(or creditable expenditure).
Net negative adjustment. Any amount which results from
netting adjustments within a grouping or subgrouping that is not
a net positive adjustment. A net negative adjustment includes a
negative adjustment that wasn’t netted with any other
adjustment.
Total netted partnership adjustments (TNPA). The sum of
all net positive adjustments in the reallocation grouping and the
residual grouping.
Adjustments not resulting in an IU. After grouping,
subgrouping, and netting the adjustments, the result of netting
with respect to any grouping or subgrouping that includes a
particular partnership adjustment is a net negative adjustment or
the IU calculation results in an amount that is zero or less than
zero. Any adjustments that don't result in an IU are taken into
account by the reviewed year partners in accordance with
Regulations section 301.6227-3.

Formula for Figuring the IU
Figuring the IU
TNPA x rate* =
+ Sum of net positive adjustments to
creditable expenditure and credit
groupings:
= Total Imputed Underpayment (IU)
* Highest rate in effect for the reviewed year under section 1 or 11.

Place each adjustment into one of four groupings: reallocation,
credit, creditable expenditure, and residual groupings.
Reallocation grouping. A reallocation adjustment generally
consists of at least two adjustments, one positive and one
negative, with each in a separate subgrouping.
• One part of the reallocation adjustment reverses the effect of
the improper allocation of a PRI.
• The other part of the adjustment makes the proper allocation
of the PRI.
• Under the AAR rules, if one of the reallocation adjustments is
negative, such negative adjustments must be pushed out to the
proper partner(s).

Generally, each separate line item of Schedule K/K-1/K-2/K-3
or return schedule (that is, Schedule L, etc.) represents a
separate and distinct subgrouping.
Example. Adjustments to ordinary income must be placed in
a different subgrouping than capital gain income or interest
income because each of those items is required to be separately
stated under section 702(a).
• Subgroupings generally reflect a line item from
Schedule K/K-1/K-2/K-3 including any subcategories of those
lines (for example, alpha codes per the Schedule K-1
instructions or activities broken out via attached statements). If
any line item on Schedule K/K-1 or other schedules consists of
multiple items and the components are required to be taken into

Don't net reallocation adjustments. As each part of a
reallocation adjustment is placed in a separate
CAUTION subgrouping within the reallocation grouping, those
adjustments cannot be netted in accordance with the netting
rules.

!

Example. $100 of ordinary income is being reallocated from
Partner A to Partner B. For purposes of figuring the IU, there will
be two adjustments, each in a separate subgrouping: a negative
Instructions for Form 8082 (Rev. Jan. 2023)

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that results after netting the adjustments is included in the
calculation of the TNPA.
• Each net negative adjustment with respect to a residual or
reallocation grouping or subgrouping that results after netting the
adjustments is excluded from the calculation of the TNPA
because those adjustments don't result in an IU.

account separately under the Internal Revenue Code,
regulations, forms, instructions, or other IRS guidance, then
such line item must be further subgrouped.
Example. 2019 Schedule K-1, box 13, code A (cash
contributions 60%), and box 13, code B (cash contributions
30%), are two separate subgroupings.
• The ordinary income/(loss) amount reflected on line 1 of
Schedule K and in box 1 of Schedule K-1 is sourced from Form
1065, page 1, and is a net amount consisting of various page 1
line items of income and expenses. Although those separate
page 1 line items are distinct items of income and expense, if
they are appropriately netted and included on line 1 of
Schedule K and box 1 of Schedule K-1, the net amount will be
considered a single subgrouping, unless such amount is
required to be separately allocated, such as when the
partnership has more than one trade or business. If the
partnership has more than one trade or business activity, the net
income/(loss) from each separate activity must be reported on
Schedule K-1. Each separate activity will constitute a separate
subgrouping and it must be determined which activity an
adjustment to the page 1 item of income and expense relates to
for subgrouping purposes.
• If you have a negative adjustment along with a positive
adjustment in the same line item of Schedule K/K-1, you must
consider whether they may be properly netted at the partnership
level and whether they are required to be taken into account
separately by any partner because it may be subject to a
limitation or preference under the Internal Revenue Code before
you can place them in the same subgrouping (for example,
passive/active for separate activities).
• A negative adjustment that is not otherwise required to be
placed in its own subgrouping must be placed in the same
subgrouping as another adjustment if the negative adjustment
and the other adjustment would have been properly netted at the
partnership level and such netted amount would have been
required to be allocated to the partners of the partnership as a
single item for purposes of section 702(a) or other provision of
the Internal Revenue Code and regulations.

Step 5—Determine the Highest Tax Rate in Effect
Under Section 1 or 11 in the Reviewed Year
Step 6—Determine the Sum of Net Positive
Adjustments to Creditable Expenditure and Credit
Groupings That Will Increase the Product of the
TNPA Multiplied by the Highest Rate in Effect

• A net decrease to creditable expenditures is treated as a net
positive adjustment to credits and increases the product of the
TNPA multiplied by the highest tax rate in effect. A net increase
to creditable expenditures is treated as a net negative
adjustment that is excluded from the calculation of the TNPA
and is an adjustment that doesn’t result in an IU.
• For the credit grouping, a net positive adjustment will increase
the product of the TNPA multiplied by the highest tax rate in
effect. A net negative adjustment, including net negative
adjustments resulting from a credit reallocation adjustment, will
be treated as an adjustment that doesn’t result in an IU.
Step 7—Figure the IU Based on the Results of
Steps 4 Through 6 and Insert Those Results Into
the IU Formula
Figuring the IU
TNPA x rate* =
+ Sum of net positive adjustments to
creditable expenditure and credit
groupings:

Step 3—Netting

= Total Imputed Underpayment (IU)

Net all adjustments within each of the groupings and
subgroupings.
• Positive adjustments may be netted with other positive
adjustments only if they are in the same grouping. Negative
adjustments may be netted with other negative adjustments only
if they are in the same grouping.
• Positive and negative adjustments may only be netted against
each other if they are in the same subgrouping.
• An adjustment in one grouping or subgrouping may not be
netted against an adjustment in any other grouping or
subgrouping.
• All adjustments within a subgrouping are netted to determine
whether there is a net positive adjustment or net negative
adjustment for that subgrouping.
• Net positive adjustments from subgroupings or positive
adjustments within a grouping (if subgroupings are unnecessary)
are netted to determine the net positive adjustment for that
grouping. Net negative adjustments from subgroupings within a
grouping are netted to determine the net negative adjustment for
that grouping.

* Highest rate in effect for the reviewed year under section 1 or 11.

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taxpayers filing this form is approved under OMB control number
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instructions for their individual income tax return.

Step 4—Figure the Total Netted Partnership
Adjustment (TNPA)

• Each net positive adjustment with respect to a particular
grouping or subgrouping in the residual or reallocation grouping
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Instructions for Form 8082 (Rev. Jan. 2023)