§6233 Interest and Penalties

Summary

When a partnership's return is changed for a reviewed year, the partnership must pay interest and any penalties on the resulting adjustment, unless section 6226(c) says otherwise. Interest runs from the day after the reviewed year's return due date until the adjustment year's return due date, or until the imputed underpayment is paid. The amount is figured under chapter 67 and must be adjusted for any partnership years between the reviewed year and the adjustment year. Penalties are figured at the partnership level as if the partnership were an individual under chapter 1 and the imputed underpayment were an actual unpaid tax or understatement for the reviewed year. If the partnership does not pay the imputed underpayment when due in the adjustment year, it must pay interest as if that amount were an underpayment in the adjustment year. The partnership also faces the late-payment penalty under section 6651(a)(2) and any penalties that apply under part II of subchapter A of chapter 68 by treating the imputed underpayment as an underpayment. A deposit can be used to stop interest from running under section 6603.