Code of Federal Regulations · Section
§ 301.6231(a)(12)-1 — (a)(12)-1 Special Rules Relating To Spouses
26 C.F.R. § 301.6231(a)(12)-1
(a) Spouses holding a joint interest—(1) In general. Except as otherwise provided in this section, spouses holding a joint interest in a partnership shall be treated as separate partners for purposes of subchapter C of chapter 63 of the Internal Revenue Code. Thus, both spouses may participate in administrative and judicial proceedings. The term joint interest includes tenancies in common, joint tenancies, tenancies by the entirety, and community property.
(2) Identification of joint interest. For purposes of this section, an interest shall be treated as a joint interest in a partnership only if both spouses are identified on the partnership return or are identified as partners entitled to notice as provided in § 301.6223(c)-1(b).
(3) Failure to identify both spouses as partners. If both spouses are not identified as set forth in paragraph (a)(2) of this section, then the partnership interest shall be treated as separately owned by the identified spouse.
(4) Example. The following example illustrates the application of paragraph (a)(3) of this section:
Wife owns an interest in ABC Partnership and is identified on the Schedule K-1 of the partnership return. Wife and Husband live in a community property state. The partnership return of ABC partnership does not identify Husband, and Husband is not identified as a partner entitled to notice as provided in § 301.6223(c)-1(b). Pursuant to paragraph (a)(3) of this section, the partnership interest of Wife shall be treated as separately owned by Wife.
(b) Notice and counting rules—(1) In general. Except as provided in paragraph (b)(2) of this section, for purposes of applying section 6223 (relating to notice to partners of proceedings) and section 6231(a)(1)(B) (relating to the exception for small partnerships), spouses holding a joint interest in a partnership shall be treated as one partner. Except as provided in paragraph (b)(2) of this section, the Internal Revenue Service or the tax matters partner may send any required notice to either spouse.
(2) Identified spouse entitled to notice. For purposes of applying section 6223 (relating to notice to partners of proceeding) for a partnership taxable year, an individual who holds a joint interest in a partnership with a spouse who is entitled to notice under section 6223 shall be entitled to receive separate notice under section 6223 if such individual—
(i) Is identified as a partner on the partnership return for that taxable year; or
(ii) Is identified as a partner entitled to notice as provided in § 301.6223(c)-1(b).
(c) Conversion of partnership items—(1) In general. If spouses holding a joint interest in a partnership are treated as separate partners under this section, then section 6231(b) (relating to the conversion of partnership items) shall be applied separately to each spouse.
(2) Example. The following example illustrates the application of paragraph (c) of this section:
Husband and Wife own a joint interest in XYZ Partnership. The partnership return identifies both spouses on the Schedule K-1. Under this section, each spouse is treated as a separate partner. If Wife enters into a settlement agreement, Wife's partnership items convert to nonpartnership items pursuant to section 6231(b)(1)(C). Accordingly, Wife no longer has the right to participate in the partnership proceeding subsequent to entering into the settlement agreement. Pursuant to paragraph (c) of this section, however, the partnership items of Husband are not affected by the conversion of the partnership items of Wife, and Husband continues to have the right to participate in the partnership proceeding. This result is the same regardless of whether the partnership items are reported on a joint return or on separate returns.
(d) Cross-reference. See § 301.6231(a)(2)-1(a) for special rules relating to spouses who file joint returns with individuals holding a separate interest in a partnership.
(e) Effective date. This section is applicable to partnership taxable years beginning on or after October 4, 2001. For years beginning prior to October 4, 2001, see § 301.6231(a)(12)-1T contained in 26 CFR part 1, revised April 1, 2001.
Authorizing Statute
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Confidentiality and disclosure of returns and return information26 U.S.C. § 6103
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Restrictions applicable to deficiencies; petition to Tax Court26 U.S.C. § 6213
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Signing of returns and other documents26 U.S.C. § 6061
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Assessment, collection, and payment26 U.S.C. § 6232
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Period of limitations on making adjustments26 U.S.C. § 6235
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Validity and priority against certain persons26 U.S.C. § 6323
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Definitions26 U.S.C. § 7701
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Partner’s return must be consistent with partnership return26 U.S.C. § 6222
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Alternative to payment of imputed underpayment by partnership26 U.S.C. § 6226
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Notice of qualification as executor or receiver26 U.S.C. § 6036
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Partners bound by actions of partnership26 U.S.C. § 6223
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Abatements26 U.S.C. § 6404
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Commissioner of Internal Revenue; other officials26 U.S.C. § 7803
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Extension of time for filing returns26 U.S.C. § 6081
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Treaty-based return positions26 U.S.C. § 6114
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Timely mailing treated as timely filing and paying26 U.S.C. § 7502
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Interest and penalties26 U.S.C. § 6233
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Certified professional employer organizations26 U.S.C. § 7705
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Accelerated cost recovery system26 U.S.C. § 168
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General requirement of return, statement, or list26 U.S.C. § 6011
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Disclosure of reportable transactions26 U.S.C. § 6111
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Rules and regulations26 U.S.C. § 7805
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Persons required to make returns of income26 U.S.C. § 6012
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Return of S corporation26 U.S.C. § 6037
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Reimbursement to State and local law enforcement agencies26 U.S.C. § 7624
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Determination at partnership level26 U.S.C. § 6221
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Partnership adjustment by Secretary26 U.S.C. § 6225
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Authority to release levy and return property26 U.S.C. § 6343
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Disclosure or use of information by preparers of returns26 U.S.C. § 7216
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Departmental regulations5 U.S.C. § 301
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Tax imposed26 U.S.C. § 1
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Notice of proceedings and adjustment26 U.S.C. § 6231
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Payment of tax by commercially acceptable means26 U.S.C. § 6311
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Sale of seized property26 U.S.C. § 6335
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Procedural requirements26 U.S.C. § 6751
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Low-income housing credit26 U.S.C. § 42
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Special rules26 U.S.C. § 1474
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Returns by exempt organizations26 U.S.C. § 6033
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Definitions and special rules26 U.S.C. § 6241
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Administrative appeal of liens26 U.S.C. § 6326
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Expenses of detection of underpayments and fraud, etc.26 U.S.C. § 7623
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Information concerning resident status26 U.S.C. § 6039E
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Identifying numbers26 U.S.C. § 6109
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Administrative adjustment request by partnership26 U.S.C. § 6227
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Authority to make credits or refunds26 U.S.C. § 6402
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Judicial review of partnership adjustment26 U.S.C. § 6234
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Failure to file notice of redetermination of foreign tax26 U.S.C. § 6689
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Income from discharge of indebtedness26 U.S.C. § 108