Category Archives: Employment Tax

Williams Parker Obtains Tax Ruling that TEFRA Does Not Apply to Payroll Tax Audits of Partnerships

During the course of an audit of a partnership for employment tax matters, an issue arose as to whether the tax partnership (which has numerous partners) was subject to the unified partnership audit and litigation provisions of TEFRA (the Tax Equity and Fiscal Responsibility Act of 1982). Representing the partnership, Williams Parker took the position that while the partnership was subject to TEFRA for income tax purposes, it was not subject to TEFRA for employment tax or worker classification matters. Due to the multitude of partners and other factors, being subject to TEFRA would have resulted in the partnership incurring significant expense and headache in trying to comply with the various TEFRA provisions during the course of the audit and any subsequent tax proceedings. Fortunately, the Internal Revenue Service Office of Chief Counsel agreed with Williams Parker in a published ruling, which can be found at the following link: TEFRA Ruling.

Michael J. Wilson
mwilson@williamsparker.com
941-536-2043