Form 8985 is the Internal Revenue Service (IRS) report that summarizes and transmits the Forms 8986 an audited partnership, an administrative adjustment request (AAR) partnership or a pass-through partner sends to partners. It is also where a pass-through partner reports a payment and the calculations behind it. On this page you can fill out the form online on FillingPDF and download or print the completed PDF; the official form and the Instructions for Form 8985 and Form 8985-V are published by the IRS at IRS.gov/Form8985.
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What is 8985?
Form 8985, Pass-Through Statement - Transmittal/Partnership Adjustment Tracking Report (Required Under Sections 6226 and 6227), is the IRS form an audited partnership, AAR partnership or pass-through partner uses to summarize and transmit Forms 8986, Partner's Share of Adjustment(s) to Partnership-Related Item(s).
The IRS describes it as the report partnerships use to track amounts of imputed underpayments (IU) pushed out to partners under section 6226. A pass-through partner also uses it to report a payment it makes and the related calculations.
The form has five parts: information about the entity submitting it (Part I), the audited partnership or the partnership that filed an AAR (Part II), the pass-through partner submitting the form (Part III), partners' total reviewed year income, gain, loss, deduction, credits and other items together with applicable penalties (Part IV), and statements (Part V).
Form 8985 is a summary. The individual partner shares are reported on Form 8986, and Part IV of Form 8985 totals the figures on the related Forms 8986. The instructions also cover Form 8985-V, which a pass-through partner uses to submit a tax payment by check or money order related to a BBA exam or BBA AAR. A BBA partnership is one subject to the centralized partnership audit regime enacted by the Bipartisan Budget Act of 2015 (BBA).
Who needs to file 8985?
The IRS instructions say three groups should prepare Form 8985:
- Audited partnerships that have made an election under section 6226.
- Direct or indirect pass-through partners that receive a Form 8986 related to an AAR or an audited partnership, whether they furnish statements to their partners or choose to pay instead.
- Partnerships that file an AAR under section 6227 and either elect to push out the resulting adjustments to their partners or have adjustments that do not result in an IU.
Pass-through partners include partnerships, S corporations, trusts and decedents' estates. A wholly owned entity disregarded as separate from its owner, or a trust wholly owned by one person, is not a pass-through partner for this form.
Who signs: if an audited partnership or AAR partnership prepares the form, the authorized partnership representative (PR) or designated individual (DI) for the reviewed tax year signs. If a pass-through partner prepares it, an individual with authority to sign that partner's information return signs; if that partner is a BBA partnership, its PR or DI for the first affected year signs.
A pass-through partner that pays the IU rather than pushing out should not issue Forms 8986 to its partners, with one stated exception, but still completes Part IV.
When to file 8985
The due date depends on who submits the form. An audited partnership that made a section 6226 election must submit Form 8985 and the related Forms 8986 no later than 60 days after the date the partnership adjustments are finally determined. Missing it may leave the partnership liable for the IU.
An AAR partnership that elects to push out adjustments, or has adjustments that do not result in an IU, includes Forms 8985 and 8986 with its AAR.
Direct and indirect pass-through partners must submit Form 8985 by the extended due date of the audited partnership's adjustment year return, or of the AAR partnership's adjustment year return. That date appears in Part II, item F, of the Form 8986 the pass-through partner received. Failure to submit on time may result in a penalty.
Corrections: an audited partnership or a pass-through partner of an audited partnership can submit corrected Forms 8985 and related Forms 8986 within 60 days of the due date for the initial forms without IRS permission. After that, it must contact the IRS for permission.
Documents you need
- Forms 8986, Partner's Share of Adjustment(s) to Partnership-Related Item(s): the push out package includes Form 8985 and all related Forms 8986 given to partners. A pass-through partner that pays an IU instead does not include any.
- If Form 8985 is corrected: all of the Forms 8986 originally submitted, including forms that did not change.
- Part V statements: a pass-through partner that figures and pays an IU includes a detailed calculation of the IU, penalties and interest.
- Part V statements for supported items: an explanation for each Part IV item with the box checked, including Schedule K-3 changes and section 199A or balance sheet adjustments.
- Form 8985-V: include it with a check or money order when a pass-through partner pays an IU by those means.
- Form 8979: needed only if the PR or DI changed or is being changed. For an AAR, include it with Form 8985; for a BBA audit, it is faxed separately to 888-981-6982.
How to fill out 8985
Mark original or corrected
At the top, check the box showing whether Form 8985 is original or corrected; this is a required field. A corrected form must go with all the Forms 8986 originally submitted.
Enter tracking and audit numbers
A BBA partnership or its pass-through partner enters the incoming tracking number (from the Form 8986 received) and the outgoing tracking number, format YYMM1234-0000XX. Enter the audit control number from IRS correspondence, except on submissions made as part of an AAR.
Identify the submitting entity
In Part I, item A, check which entity issues the form, and in item B check the type of return it normally files, adding the type on the line if you check Other. In item C enter the number of Forms 8986 tied only to this form, or zero if you pay instead of issuing them.
Complete items D and E
Only audited BBA partnerships and their pass-through partners fill these in. Generally check box D and enter 1 of 1 in box E; for batched submissions over 500 partners, enter 1 of X, 2 of X and so on.
Enter partnership and representative details
In Part II, item A, enter the partnership's name and address; item B, the PR's name, address, ZIP code and phone (or the DI's if the PR is an entity); item C, the partnership's tax identification number.
Enter the Part II dates
Item D is the tax year end date of the reviewed year; use a separate Form 8985 for each reviewed year. Item E is the adjustment year ending date, item F the extended due date of the adjustment year return, and item G the date the Forms 8986 were furnished to partners.
Complete Part III for pass-through partners
Enter the pass-through partner's name and address (item A), tax identification number (B) and the tax year end to which adjustments relate (C). Items D and E are the name and tax identification number of the entity that issued the Form 8986, if different from Part II.
Indicate payment or push out
In Part III, item F, check box 1 or 2 to show whether the partner pays or issues Forms 8986. For electronic payment, check box 3 and enter the confirmation number; for a check or money order, check box 4 and enter the check number.
Report items in Part IV
For each adjusted item enter the Schedule K-1 line number (K3 for Schedule K-3 changes), line title, code (or NA) and the aggregate as-reported amount in columns (a) through (d). Check column (e) if the item has a statement in Part V.
Enter modifications and corrected totals
Column (f) is total IRS-approved modifications; column (g) is reviewed year adjustments net of approved modifications; column (h) is column (d) plus column (g). Enter totals at the bottom of Part IV.
List applicable penalties
In the penalties section of Part IV, enter the penalty code sections, descriptions, rates, adjustment line numbers and the total adjustment amount each penalty applies to.
Add Part V statements
List the Schedule K-1 line number and code in column (a) and a detailed explanation in column (b), showing original amount, net change and corrected amount. A pass-through partner paying an IU enters "Part III F" in column (a) with the calculation in column (b).
Sign, date and download the PDF
The PR, DI or an authorized individual signs and dates, with title and daytime phone; electronic filers e-sign with a five-digit PIN. Review the entries, then download or print the completed PDF from FillingPDF and submit it through the IRS channels under How to submit.
How to submit 8985
The channel depends on who submits: electronic submission, filing with an AAR, fax, or mail.
- Electronic submission: audited BBA partnerships and their pass-through partners are required to submit Forms 8985 and 8986 electronically. The IRS page IRS.gov/BBAeSubmit explains how to register and submit.
- With an AAR: AAR partnerships that elect to push out adjustments, or have adjustments that do not result in an IU, include Form 8985 and Forms 8986 with the AAR. They are filed with, and in the same manner as, the AAR.
- Fax: pass-through partners of an AAR partnership submit Form 8985 by fax to 888-981-6982, with or without Forms 8986 as applicable. The number is only for Forms 8985 and 8986, and illegible or other submissions are not processed.
- Mail: if the Form 8985/8986 package is over 100 pages, it must be printed and mailed. See the submission chart under File an administrative adjustment request under Bipartisan Budget Act of 2015 (BBA) on IRS.gov.
- Form 8985-V payments: mail Form 8985-V with a check or money order to Department of the Treasury, Internal Revenue Service, Ogden, UT 84201-0011, payable to "United States Treasury". Other payment options are at IRS.gov/Payments.
A changed PR or DI is reported on Form 8979. FillingPDF lets you fill out and download the PDF; submission follows the IRS channels above.
Common mistakes to avoid
- Submitting a corrected Form 8985 without all of the Forms 8986 originally submitted; the instructions require every one, including forms that did not change.
- Leaving Part I, item C blank or non-zero when a pass-through partner of an audited BBA partnership pays instead of issuing Forms 8986; it must enter zero.
- Faxing a Form 8985/8986 package of more than 100 pages instead of printing and mailing it, or sending illegible or unrelated material to the fax number.
- Pushing out only some adjustments; a pass-through partner that pushes out must push out all of them.
- Including modifications in the IU calculation as a pass-through partner of an AAR partnership, which cannot include them, or showing AAR modifications in Part IV, column (g).
- Entering an audit control number on a Form 8985 submitted as part of an AAR; the number does not apply there.
- Showing a decrease to a Schedule K-1 item as a positive number in Part IV; decreases are negative and increases are positive.
- Typing a signer name that differs from the name entered at the TCC application step, such as "John Smith" instead of "John T. Smith", on an electronically submitted form.
- Filling the incoming tracking number for an AAR partnership; it should remain blank.
Frequently asked questions
What is Form 8985 used for?
Form 8985 is used to summarize and transmit Forms 8986 issued by an audited partnership, an AAR partnership or a pass-through partner. A pass-through partner also uses it to report a payment and the related calculations. It tracks imputed underpayments pushed out under section 6226.
Who has to file Form 8985?
Audited partnerships that made a section 6226 election, direct or indirect pass-through partners that receive a Form 8986, and partnerships that file an AAR under section 6227 and either push out adjustments or have adjustments that do not result in an IU.
What is the due date for Form 8985?
An audited partnership submits it within 60 days after the adjustments are finally determined. Pass-through partners submit by the extended due date of the adjustment year return; Part II, item F of the Form 8986 received shows that date. AAR partnerships include it with the AAR.
Can I fax Form 8985 to the IRS?
Only pass-through partners of an AAR partnership may fax it, to 888-981-6982. Packages over 100 pages must be mailed. Audited BBA partnerships and their pass-through partners must submit electronically, as described at IRS.gov/BBAeSubmit.
What is the difference between Form 8985 and Form 8986?
Form 8986 reports each partner's share of the adjustments. Form 8985 summarizes and transmits those Forms 8986, and Part IV totals their amounts. A pass-through partner that pays the IU still completes Part IV but generally does not issue Forms 8986 to its partners.
Do I need Form 8985-V?
Only if a pass-through partner pays an imputed underpayment by check or money order. Mail Form 8985-V with the payment to Department of the Treasury, Internal Revenue Service, Ogden, UT 84201-0011, payable to "United States Treasury". Electronic payment options are at IRS.gov/Payments.
How do I correct a Form 8985 I already submitted?
Check the corrected box and resubmit with all of the Forms 8986 originally submitted, including unchanged ones. Corrections within 60 days of the due date need no IRS permission; after that, contact the IRS for permission.
Can I fill out Form 8985 online on FillingPDF?
Yes. You can fill out the PDF online on FillingPDF and download or print it. FillingPDF is an independent service and does not submit the form to the IRS; you submit it through the IRS channels described in the instructions.
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