U.S. Code » Title 26 » Subtitle F— Procedure and Administration › CHAPTER 63— ASSESSMENT › Subchapter C— Treatment of Partnerships › PART III— PROCEDURE

26 U.S.C. § 6233

Interest and penalties

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(a) Interest and penalties determined from reviewed year(1) In generalExcept to the extent provided in section 6226(c), in the case of a partnership adjustment for a reviewed year—(A) interest shall be computed under paragraph (2), and(B) the partnership shall be liable for any penalty, addition to tax, or additional amount as provided in paragraph (3).(2) Determination of amount of interest

The interest computed under this paragraph with respect to any partnership adjustment is the interest which 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 (or, if earlier, the date payment of the imputed underpayment is made). Proper adjustments in the amount determined under the preceding sentence shall be made for adjustments required for partnership taxable years after the reviewed year and before the adjustment year by reason of such partnership adjustment.

(3) Penalties

Any penalty, addition to tax, or additional amount shall be determined at the partnership level as if such partnership had been an individual subject to tax under chapter 1 for the reviewed year and the imputed underpayment were an actual underpayment (or understatement) for such year.

(b) Interest and penalties with respect to adjustment year return(1) In generalIn the case of any failure to pay an imputed underpayment on the date prescribed therefor, the partnership shall be liable—(A) for interest as determined under paragraph (2), and(B) for any penalty, addition to tax, or additional amount as determined under paragraph (3).(2) Interest

Interest determined under this paragraph is the interest that would be determined by treating the imputed underpayment as an underpayment of tax imposed in the adjustment year.

(3) PenaltiesPenalties, additions to tax, or additional amounts determined under this paragraph are the penalties, additions to tax, or additional amounts that would be determined—(A) by applying section 6651(a)(2) to such failure to pay, and(B) by treating the imputed underpayment as an underpayment of tax for purposes of part II of subchapter A of chapter 68.(c) Deposit to suspend interest

For rules allowing deposits to suspend running of interest on potential underpayments, see section 6603.

(Added Pub. L. 114–74, title XI, § 1101(c)(1), Nov. 2, 2015, 129 Stat. 633; amended Pub. L. 115–141, div. U, title II, § 206(i), Mar. 23, 2018, 132 Stat. 1180.)Editorial NotesPrior Provisions

A prior section 6233, added Pub. L. 98–369, div. A, title VII, § 714(p)(1), July 18, 1984, 98 Stat. 964; amended Pub. L. 104–188, title I, § 1307(c)(3)(B), Aug. 20, 1996, 110 Stat. 1782, related to extension to entities filing partnership returns, prior to repeal by Pub. L. 114–74, title XI, § 1101(a), Nov. 2, 2015, 129 Stat. 625.

Amendments

2018—Subsec. (c). Pub. L. 115–141 added subsec. (c).

Statutory Notes and Related SubsidiariesEffective Date of 2018 Amendment

Amendment by Pub. L. 115–141 effective as if included in section 1101 of Pub. L. 114–74, see section 207 of Pub. L. 115–141, set out as a note under section 6031 of this title.

Effective Date

Section applicable to returns filed for partnership taxable years beginning after Dec. 31, 2017, with certain exceptions, see section 1101(g) of Pub. L. 114–74, set out as a note under section 6221 of this title.

Notes of Decisions
Cited in 7 cases (4 in the last 5 years), 2003–2024 · leading case: Petaluma FX Partners, LLC v. Comm'r Serv., 591 F.3d 649 (D.C. Cir. 2010).
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Petaluma FX Partners, LLC v. Comm'r Serv., 591 F.3d 649 (D.C. Cir. 2010). “(1) Section 6233 The jurisdiction of the Tax Court over this case is governed by 26 U.S.C. § 6233 . That section addresses instances in which a partnership return is filed, but the purported partnership either does not exist or is not actually a partnership.”
Andantech L.L.C. v. Comm'r, 331 F.3d 972 (D.C. Cir. 2003). “” The government reasoned that while 26 U.S.C. § 6233 (2000) and Treas. Reg. 301.”
Raghunathan Sarma v. Comm'r, 45 F.4th 1312 (11th Cir. 2022). “26 U.S.C. § 6233 ; Treas. Reg. § 301.6233 - 1.”
Reed v. Civiello, 297 F. Supp. 2d 1008 (N.D. Ohio 2003). “” 26 U.S.C. § 6233 (a). Section 6323(f), in turn, provides that, in the case of real property, the Secretary must file notice of the federal tax lien “in one office within the State (or the county, or other governmental subdivision), as designated by the laws of such State, in…”
VI Derivatives LLC By Vifx, LLC v. Dir., Virgin Islands Bureau of Internal Revenue, No. 3:06-cv-00004 (D.V.I. Oct. 7, 2024). · cites it 2× “§ 6226 (f), we need not reach the LLCs’ arguments about 26 U.S.C. § 6233 (2012). Id. at *1 n.2. The Third Circuit’s mandate issued on July 14, 2023, rendering the decision in Vento III final.”
Vifx, LLC v. Dir., Virgin Islands Bureau of Internal Revenue, No. 3:06-cv-00005 (D.V.I. Oct. 7, 2024). · cites it 2× “§ 6226 (f), we need not reach the LLCs’ arguments about 26 U.S.C. § 6233 (2012). Id. at *1 n.2. The Third Circuit’s mandate issued on July 14, 2023, rendering the decision in Vento III final.”
VI Derivatives LLC by Vifx LLC its Tax Matters Par v. Dir. Virgin Islands Bureau of Internal Revenue, No. 22-3056, 2023 U.S. App. LEXIS 15647 (3d Cir. June 22, 2023). “§ 6226 (f), we need not reach the LLCs’ arguments about 26 U.S.C. § 6233 (2012). We review de novo a district court’s grant of summary judgment.”
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