A "Partnership Representative" clause designates a specific individual or entity to act as the liaison between the partnership and tax authorities, handling all IRS audits and related proceedings on behalf of the partnership. This clause ensures that one representative has the authority to make binding decisions regarding tax matters, simplifying communication and compliance processes for the partnership.
(b) Designation of Partnership Representative; Scope of Duties and Authority. (i) The “partnership representative” (within the meaning of Section 6223(a) of the Code) (the “Partnership Representative”) of the Partnership shall be the General Partner. The Partnership Representative shall designated from time to time a “designated individual” to act on behalf of the Partnership Representative, and such designated individual shall be subject to replacement by the Partnership Representative in accordance with the Code and Treasury Regulations. The Partnership Representative is authorized to and shall represent the Partnership (at the Partnership’s expense) in connection with all examinations of the Partnership ’s affairs by any federal, state, or local tax authorities, including resulting administrative and judicial proceedings (each a “Tax Audit” and collectively, “Tax Audits”), and to expend Partnership funds for professional services and costs associated therewith. (ii) In its capacity as such, the Partnership Representative shall have the authority and discretion to exercise any and all authority of the Partnership Representative under the Code, including, without limitation, (i) binding the Partnership and its Partners with respect to tax matters, including, but not limited to, by entering into any settlement offer, agreeing to extend statutes of limitation, and initiating litigation and, (ii) if the IRS, in connection with a Tax Audit governed by the Partnership Tax Audit Rules, proposes a Covered Audit Adjustment, determining, in its sole discretion, whether, to the extent that such election is available under the Partnership Tax Audit Rules, to make a Push-Out Election. (iii) If the Partnership Representative changes its address, the Partnership Representative shall promptly notify the IRS of such occurrence. If the Partnership Representative is replaced pursuant to Section 10.05(b)(i), the outgoing Partnership Representative shall take all actions required by the Partnership Tax Audit Rules to revoke or resign its prior designation as the Partnership Representative.
(ii)The General Partner shall be the “partnership representative” of the Partnership for U.S. federal income tax purposes, and relevant state income tax purposes (the “Partnership Representative”) for all Tax years beginning with the first Taxable year that is subject to the BBA Rules; provided that the General Partner may resign as, remove and replace the Partnership’s Partnership Representative, in each case in its sole discretion. The Partnership Representative shall be entitled to, and shall, designate, a “designated individual” within the meaning of and in accordance with applicable Regulations; provided that any such designated individual may resign, and the partnership representative may remove, revoke and replace any such designated individual, in each case in accordance with such Regulations. The Partnership and each Partner shall take such actions as are necessary to effect the designations made in accordance with this Section 10.3(a), and the following provisions of this Section 10.3 shall apply with respect to each Partnership Representative and designated individual for the Taxable year(s) with respect to which such persons are so designated. References to Partnership Representative in the remainder of Section 10.3 shall include the designated individual unless the context otherwise requires.
8.7 Partnership Representative. The provisions of this Section 8.7 shall apply for taxable years beginning after December 31, 2017 (or any earlier year, if the Board of Directors so elects). (a) The Board of Directors shall designate a partnership representative (in such capacity, the “Partnership Representative”) to act under Section 6223 of the Code and in any similar capacity under state, local and/or non-United States law, as applicable. The Board of Directors has initially designated the Chief Financial Officer of the Company to serve as the Partnership Representative. The Partnership Representative may be removed and replaced by the Board of Directors at any time in its sole discretion. (b) The Partnership Representative, in consultation with the Company’s finance and audit committee and/or such other committee designated by the Board of Directors, shall be authorized and required to represent the Company (at the Company’s expense) in connection with all examinations of the Company’s affairs by tax authorities, including resulting administrative and judicial proceedings, and to expend Company funds for professional services and other expenses reasonably incurred in connection therewith. The Partnership Representative may authorize a Member (in such capacity, an “Authorized Member”) to assist the Partnership Representative in representing the Company (at the Company’s expense) in connection with any such tax examination. Each Member agrees to cooperate with the Company and to do or refrain from doing any or all things reasonably requested by the Company with respect to the conduct of such proceedings. The Partnership Representative shall be authorized to make any available election, to the extent eligible, under Code Sections 6221 through 6241 and take any action he/she deems necessary or appropriate to comply with the requirements of the Code and the conduct of the Company under Code Sections 6221 through 6241, but in each case only with the approval of the Board of Directors. (c) The Partnership Representative shall keep all Members reasonably advised on a current basis of any contacts by or discussions with the tax authorities, and the Members shall have the right to observe and participate through representatives of their own choosing (at their sole expense) in any tax proceedings, to the extent permitted by the related tax authority. (d) Except as expressly provided otherwise in Article VII, the Members shall have no claim against the Company, the Board of Directors, the Partnership Representative or any Authorized Member for any form of damages or liability as a result of actions taken or remedies pursued by or on behalf of the Company in order to comply with Sections 6221 through 6241 of the Code or similar provisions of state, local and/or non-United States Law. (e) In the case of any adjustment by the IRS in the amount of any item of income, gain, loss, deduction, or credit of the Company or any Member’s distributive share thereof (“IRS Adjustment”), the Partnership Representative shall respond to such IRS Adjustment in accordance with this Agreement, as approved by the Board of Directors. “Adjustment Year” means (1) in the case of an adjustment pursuant to the decision of a court, the Company’s taxable year in which the decision becomes final; (2) in the case of an administrative adjustment request, the Company’s taxable year in which the administrative adjustment is made; or (3) in any other case, the Company’s taxable year in which the notice of final partnership adjustment is mailed. “Reviewed Year” means the Company’s taxable year to which the item being adjusted related. (i) Payment by the Company. In accordance with Section 6225 of the Code, the Company shall pay an imputed underpayment as calculated under Section 6225(b) of the Code with respect to the IRS Adjustment, including interest and penalties (“Imputed Tax Underpayment”), in the Adjustment Year. The Partnership Representative shall use commercially reasonable efforts to pursue available procedures to reduce any Imputed Tax Underpayment on account of any Member’s tax status and each Member shall promptly comply with any reasonable request made by the Partnership Representative to accommodate such procedures. (ii) Issue Adjusted Schedules K-1. Alternatively, with the approval of the Board, the Partnership Representative may elect under Section 6226 of the Code to cause the Company to issue to each Member an adjusted Internal Revenue Service Schedules “K-1” (or such other form as applicable) reflecting such Member’s share of any IRS Adjustment. (f) At the direction of the Board of Directors or the Partnership Representative, each Member agrees to take into account its allocable share of the Company’s income (or losses), including any adjustments to tax attributes, resulting from an IRS Adjustment and to pay any tax due as required under Section 6225(c)(2) of the Code, even if an Imputed Tax Underpayment liability of the Company or IRS Adjustment occurs after the Member’s withdrawal from the Company, either by (i) amending its U.S. federal income tax return(s) for the Reviewed Year and for any other affected tax years to include such adjustments or (ii) providing such information for the alternative procedure as required by Section 6225(c)(2)(B) of the Code. (g) Each Member does hereby agree to indemnify and hold harmless the Company, the Board of Directors, the Partnership Representative, the Member serving as Tax Matter Partner, and any Authorized Member from and against any liability with respect to the Member’s proportionate share of any Imputed Tax Underpayment or other IRS Adjustment resulting in liability imposed upon the Company under the Code, regardless of whether such Member is a Member in the Company in an Adjustment Year, with such proportionate share as reasonably determined by the Board of Directors, including its reasonable discretion to consider each Member’s interest in the Company in the Reviewed Year and a Member’s timely provision of information necessary to reduce the amount of Imputed Tax Underpayment set forth in Section 6225(c) of the Code. This obligation to indemnify and hold harmless shall survive a Member’s ceasing to be a Member of the Company and/or the termination, dissolution, liquidation and winding up of the Company.
(2) The General Partner shall be the “partnership representative” of the Partnership for U.S. federal income tax purposes for all tax years beginning with the first taxable year that is subject to the BBA Rules; provided that the General Partner may resign as, remove and replace the Partnership’s partnership representative, in each case in its sole discretion. The partnership representative shall be entitled to, and shall, designate, a “designated individual” within the meaning of and in accordance with applicable Regulations; provided that any such designated individual may resign, and the partnership representative may remove, revoke and replace any such designated individual, in each case in accordance with such Regulations. The Partnership and each Partner shall take such actions as are necessary to effect the designations made in accordance with this Section 10.3, and the following provisions of this Section 10.3 shall apply with respect to each partnership representative and designated individual for the taxable year(s) with respect to which such persons are so designated.
(b)For each taxable year of the Partnership beginning on or after January 1, 2018, the General Partner shall act as or appoint the “partnership representative” of the Partnership for purposes of Section 6223(a) of the Code and any comparable provisions of state and local law and, if necessary, shall appoint a “designated individual” within the meaning of Treasury regulations section 301.6223-1 and any comparable provisions of state and local law (the “Partnership Representative” and “Designated Individual,” respectively). The General Partner may designate a new Partnership Representative or Designated Individual at any time subject to applicable law and shall designate a new Partnership Representative or Designated Individual if such person or entity resigns or is deemed ineligible. The Partnership Representative shall have all of the powers and responsibilities of such position as provided in the Code and Treasury regulations and may take any action or make any elections contemplated by Partnership Audit Rules in its sole and absolute discretion. The Partnership Representative shall have the right to retain professional assistance as it, in its sole and absolute discretion, determines is necessary to or useful in the performance of its duties, and all out-of-pocket expenses and fees incurred by or in respect of the Partnership Representative shall constitute Partnership expenses. Any Person who serves as Partnership Representative or Designated Individual shall not be liable to the Partnership or any Partner for any action it takes or fails to take in such capacity, unless such action or failure to act constitutes gross negligence or deliberate misconduct. The provisions relating to indemnification of the Indemnitees set forth in Section 6.03 hereof shall be fully applicable to the Partnership Representative and the Designated Individual, if any, acting as such. Upon the Partnership’s request, each Partner shall provide to the Partnership within the required time frame any information that the Partnership Representative believes may be necessary or appropriate to resolve any tax issue relating to the Partnership or comply with or be eligible to invoke any aspect of the Partnership Audit Rules. Notwithstanding any provision of this Agreement to the contrary, any taxes, penalties, and interest payable by the Partnership under the Partnership Audit Rules shall be treated as attributable to the Partners, and, to the extent possible, the Partnership Representative shall allocate the burden of any such amounts to those Partners to whom such amounts are reasonably attributable. Any such amounts allocated to a Partner, at the option of the Partnership Representative, shall (a) be promptly paid to the Partnership by such Partner or (b) be paid by reducing the amount of the current or next succeeding distribution or distributions which would otherwise have been made to such Partner. The obligations of each Partner (or former Partner) under this Section 10.05(b) shall survive the Transfer by such Partner of its interest in the Partnership or the dissolution of the Partnership. In the event a Partner Transfers its interest in the Partnership, the transferee and transferor shall be jointly and severally liable for any liability with respect to the obligations of the transferor Partner under this Section 10.05(b).
(B) For each taxable year of the a Portfolio subject to the BBA Audit Rules (defined below), Invesco Advisers, Inc. will be designated, and will be specifically authorized to act as, the Portfolio’s “Partnership Representative” within the meaning of Section 6223 of the Code, as amended by the 2015 Budget Act (defined below). The Partnership Representative shall be indemnified and held harmless by the Portfolio from any and all liabilities and obligations that arise from or by reason of such designation and actions taken in such capacity. Because the Partnership Representative is not an individual, each Shareholder hereby understands and agrees that the Partnership Representative has full authority and discretion to appoint the “designated individual” through which the Partnership Representative acts and hereby ratifies and confirms the appointment of such person by the Partnership Representative as the “designated individual.” The Partnership Representative will apply the provisions of the BBA Audit Rules with respect to any audit, imputed underpayment, other adjustment, or any such decision or action by the IRS with respect to the Portfolio or the Shareholders for such taxable years, in the manner determined by the Partnership Representative. Except as otherwise provided herein, the Partnership Representative shall be authorized to take any action, including, but not limited to, seeking judicial review of an audit, extending the statute of limitations for the assessment of any tax, and entering into a settlement with the Internal Revenue Service or any other taxing authority. To the maximum extent permitted under the BBA Audit Rules, as reasonably determined by the Partnership Representative in consultation with a Portfolio’s tax advisers:
(d) The Members agree to cooperate in good faith and to respond on a timely basis to reasonable requests by the Partnership Representative to provide information needed to satisfy any applicable tax reporting or compliance requirements, to make any tax election, or to qualify for an exception from or reduced rate of tax or other tax benefit or be relieved of liability for any tax regardless of whether such requirement, tax benefit, or tax liability existed on the date any such Member was a Member of the Company. If a Member fails to provide any such forms, statements, or other information requested by the Partnership Representative, as applicable, such Member will be required to indemnify the Company for the share of any tax deficiency paid or payable by the Company that is due to such failure (as reasonably determined by the Partnership Representative). Further, each Member agrees to make elections on tax returns and file amended tax returns consistent with the determinations made by the Partnership Representative in connection with any proceedings of the Company under the Audit Procedures.
With respect to Partnership taxable years beginning after December 31, 2017, the General Partner is designated as the “partnership representative” in accordance with the rules prescribed pursuant to Section 6223 of the Code (the “Partnership Representative”). The Partnership Representative shall have the authority to designate from time to time a “Designated Individual” to act on behalf of the Partnership Representative, and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with Treasury Regulations Section 301.6223-1. The Partnership Representative, or the Designated Individual, as applicable, shall have the sole authority to act on behalf of the Partnership in connection with all examinations of the Partnership’s affairs by tax authorities, including resulting administrative and judicial proceedings, and to expend Partnership funds for professional services and costs associated therewith. The Partnership Representative or the Designated Individual, as applicable, shall exercise in its sole discretion, any and all authority of the Partnership Representative under the Code, including, without limitation, (i) binding the Partnership and its Partners with respect to tax matters and (ii) determining whether to make any available election under Section 6226 of the Code. Any reasonable, documented cost or expense that the Partnership Representative or the Designated Individual, as applicable, incurs in connection with its duties, including the preparation for or pursuance of administrative or judicial proceedings, shall be paid by the Partnership. Neither the Partnership Representative nor the Designated Individual shall be liable to the Partnership or to its partners for acts or omissions taken or suffered by it in its capacity as either Partnership Representative or Designated Individual, as the case may be, in good faith; provided that such act or omission is not in willful violation of this Agreement and does not constitute fraud or a willful violation of law.
With respect to Partnership taxable years beginning after December 31, 2017, the General Partner is designated as the “partnership representative” in accordance with the rules prescribed pursuant to Section 6223 of the Code (the “Partnership Representative”). The Partnership Representative shall have the authority to designate from time to time a “Designated Individual” to act on behalf of the Partnership Representative, and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with Treasury Regulations Section 301.6223-1. The Partnership Representative, or the Designated Individual, as applicable, shall have the sole authority to act on behalf of the Partnership in connection with all examinations of the Partnership’s affairs by tax authorities, including resulting administrative and judicial proceedings, and to expend Partnership funds for professional services and costs associated therewith. The Partnership Representative or the Designated Individual, as applicable, shall exercise in its sole discretion, any and all authority of the Partnership Representative under the Code, including, without limitation, (i) binding the Partnership and its Partners with respect to tax matters and (ii) determining whether to make any available election under Section 6226 of the Code. Any reasonable, documented cost or expense that the Partnership Representative or the Designated Individual, as applicable, incurs in connection with its duties, including the preparation for or pursuance of administrative or judicial proceedings, shall be paid by the Partnership. Neither the Partnership Representative nor the Designated Individual shall be liable to the Partnership or to its partners for acts or omissions taken or suffered by it in its capacity as either Partnership Representative or Designated Individual, as the case may be, in good faith; provided that such act or omission is not in willful violation of this Agreement and does not constitute fraud or a willful violation of law.
With respect to Partnership taxable years beginning after December 31, 2017, the General Partner shall designate the Organizational Limited Partner, or such other Partner as the General Partner shall designate, as the “partnership representative” in accordance with the rules prescribed pursuant to Section 6223 of the Code (the “Partnership Representative”). The Partnership Representative shall have the authority to designate from time to time a “Designated Individual” to act on behalf of the Partnership Representative, and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with Treasury Regulations Section 301.6223-1. The Partnership Representative, or the Designated Individual, as applicable, shall have the sole authority to act on behalf of the Partnership in connection with all examinations of the Partnership’s affairs by tax authorities, including resulting administrative and judicial proceedings, and to expend Partnership funds for professional services and costs associated therewith. The Partnership Representative or the Designated Individual, as applicable, shall exercise in its sole discretion, any and all authority of the Partnership Representative under the Code, including, without limitation, (i) binding the Partnership and its Partners with respect to tax matters and (ii) determining whether to make any available election under Section 6226 of the Code. Any reasonable, documented cost or expense that the Partnership Representative or the Designated Individual, as applicable, incurs in connection with its duties, including the preparation for or pursuance of administrative or judicial proceedings, shall be paid by the Partnership. Neither the Partnership Representative nor the Designated Individual shall be liable to the Partnership or to its partners for acts or omissions taken or suffered by it in its capacity as either Partnership Representative or Designated Individual, as the case may be, in good faith; provided that such act or omission is not in willful violation of this Agreement and does not constitute fraud or a willful violation of law.
(i) The Partnership Representative shall be entitled to represent the interests of OSH LLC and OSH MH LLC in connection with any Tax Proceeding regarding the Flow-Through Income Tax Returns of OSH LLC and OSH MH LLC for any year ending before the Contribution Date (a “Flow-Through Income Tax Proceeding”) and to retain counsel or other tax advisors of the Partnership Representative’s choosing in connection with a Flow-Through Income Tax Proceeding. The Partnership Representative shall keep OSH Inc. reasonably informed regarding a Flow-Through Income Tax Proceeding and allow OSH Inc. (and its counsel) to review and comment on any material to be submitted to the applicable Taxing Authority. The Partnership Representative shall consider in good faith any comments that OSH Inc. (or its counsel) makes to any submissions or other items to be provided to the applicable Taxing Authority. The Partnership Representative shall be entitled to make any elections in connection any Flow-Through Income Tax Proceeding (including the option (but not the obligation) to timely elect to “push out” any imputed underpayments under Section 6226 of the Code (and any similar provisions under state or local Law)) (a “Push-Out Election”). The Partnership Representative shall be entitled to settle or otherwise resolve any adjustment that is proposed, asserted or assessed in connection with a Flow-Through Income Tax Proceeding; provided that if OSH Inc. or its Affiliates are to incur a majority of the Taxes resulting from such settlement or resolution, the Partnership Representative shall obtain the prior written consent of the OSH Inc. (which shall not be unreasonably withheld, delayed, or conditioned) prior to entering into the settlement or other resolution.
(a) The Partnership Representative shall prepare and file, or cause to be prepared and filed, all necessary U.S. federal, state or local income tax returns for the Tax Partnership. [*] The Partnership Representative shall cause the Tax Partnership to furnish each Partner with an IRS Form K-1 for such Taxable Year. In addition, the Partnership Representative shall deliver or cause to be delivered not later than the 45th day after the end of each Taxable Year to each Partner all information that is reasonably necessary for the preparation of such Partner’s federal income tax returns and any state, local and foreign income tax returns that such Partner is required to file, and related financial reporting obligations of such Partner with respect to its ownership of the Tax Partnership.
A Partnership Representative is an individual or entity designated to act on behalf of a partnership in dealing with the IRS during audits and other tax matters. This role was established under the Bipartisan Budget Act of 2015 (BBA), which significantly changed how partnerships handle IRS audits and related procedures, shifting much of the responsibility and authority away from individual partners to the partnership representative.
You should designate a Partnership Representative whenever your partnership files an annual tax return. It is particularly important for partnerships subject to the BBA rules, as the representative has the authority to make binding decisions that affect the partnership and its partners in regard to tax issues. This role is crucial during audits, dispute resolutions, and any discussions or negotiations with the IRS.
When designating a Partnership Representative, you typically do so on the partnership’s tax return, using the IRS Form 1065. The designation should include:
For example:
In Part II of IRS Form 1065, the partnership will list:
Name: John Doe
TIN: 123-45-6789
Address: 123 Main St, Anytown, USA
Phone: (555) 555-1234
Also, it is advisable to formalize this designation within the partnership agreement, detailing the scope of authority and responsibilities.
Partnership agreements often contain provisions for the designation and responsibilities of a Partnership Representative. Here are typical contracts where you might find these provisions:
By including these provisions in relevant contracts, partnerships can ensure clarity and compliance with IRS requirements while managing their tax matters effectively.
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