Case: Nonparticipating Partners Failed to Make Substantial Showing to Participate in TEFRA Case (T.C.) (IRC §6226)

Nonparticipating partners’ motions to participate in a TEFRA partnership case were denied because the partners failed to make a substantial showing as to why they should be permitted to participate, the U.S. Tax Court held. Taxpayer, a limited liability company, claimed a charitable contribution deduction for a conservation easement donation. The IRS issued a notice of final partnership administrative adjustment disallowing most of the deduction and asserting penalties. The tax matters partner (TMP) filed a petition challenging the adjustment, then entered into a settlement agreement with the IRS. Nonparticipating partners filed motions to participate and object to the settlement. The ...