Megan L. Brackney was quoted in a recent Tax Notes article entitled “Success of BBA Audit Regime Goes Beyond Numbers,” published on March 28, 2022. Brackney analyzes the findings of the Treasury Inspector General for Tax Administration’s report released on March 23, 2022.
The article notes:
Megan L. Brackney of Kostelanetz & Fink LLP said she wasn’t surprised by the high no-change rates, given that the IRS is still in the early phase of conducting BBA exams. But she thought that TIGTA’s focus on those numbers may not be unreasonable. In her view, Congress enacted the BBA regime not only to simplify assessment and collection but also to make it easier for the IRS to audit partnerships, “with an inferred goal of increasing compliance through adjustments
to returns.”
Brackney noted that no-change rates were very high under the IRS’s large partnership procedures for TEFRA exams, as a September 2014 Government Accountability Office report found. “I believe that this was something that was considered in the enactment of the BBA and promulgation of regulations,” she said.
“I do think that Congress and Treasury would have expected that the BBA would increase the partnership audit rate and lead to more productive audits and adjustments, not just no-change letters,” Brackney said.
Brackney agreed that the BBA regime won’t necessarily make it easier for the IRS to identify noncompliance. To successfully audit large and complex partnership returns, the agency will need more resources, she said.
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