Montana Title 15. Taxation § 15-30-3401. Definitions

(1) “Administrative adjustment request” means an administrative adjustment request filed by a partnership under 26 U.S.C. 6227.

(2) “Direct partner” means a partner that holds an interest directly in a partnership or pass-through entity.

(3) “Exempt partner” means a partner that is exempt from taxation under 15-31-102.

(4) “Federal adjustment” means a change to an item or amount determined under the Internal Revenue Code that is used by a taxpayer to compute the Montana income tax owed, regardless of whether that change results from action by the internal revenue service, including a partnership level audit, or the filing of an amended federal return, federal refund claim, or an administrative adjustment request by the taxpayer.

(5) “Federal adjustments report” includes methods or forms required by the department for use by a taxpayer to report final federal adjustments, including an amended Montana tax return, information return, or a uniform multistate report.

(6) “Federal partnership representative” means the person the partnership designates for the tax year as the partnership's representative, or the person the internal revenue service has appointed to act as the federal partnership representative, pursuant to 26 U.S.C. 6223(a).

(7) “Final determination date” means:

(8) “Final federal adjustment” means a federal adjustment after the final determination date for that federal adjustment has passed.

(9) “Indirect partner” means a partner in a partnership or pass-through entity that itself holds an interest directly, or through another indirect partner, in a partnership or pass-through entity.

(10) “Partnership level audit” means an examination by the internal revenue service at the partnership level pursuant to Subchapter C of Title 26, Subtitle F, Chapter 63, of the Internal Revenue Code, as enacted by the Bipartisan Budget Act of 2015, Public Law 114-74, which results in federal adjustments.

(11) “Reallocation adjustment” means a federal adjustment resulting from a partnership level audit or an administrative adjustment request that changes the shares of one or more items of partnership income, gain, loss, expense, or credit allocated to direct partners. A positive reallocation adjustment means the portion of a reallocation adjustment that would increase federal income for one or more direct partners, and a negative reallocation adjustment means the portion of a reallocation adjustment that would decrease federal income for one or more direct partners pursuant to regulations under 26 U.S.C. 6225.

(12) “Resident partner” means an individual, trust, or estate partner that is a resident of Montana as defined in 15-30-2101 for the relevant tax period.

(13) “Reviewed year” means the tax year of a partnership that is subject to a partnership level audit from which federal adjustments arise.

(14) “Tiered partner” means any partner that is a partnership or pass-through entity.