Form 8989 – Revoke a Section 6226 Push-Out Election

Editorial Standards

How we research, review, and update this guide

Every Accountably guide is researched against primary IRS sources, reviewed by a U.S. CPA, and refreshed as guidance evolves. Read our Editorial Guidelines to see how we source, fact-check, and update our content.

When a partnership client received a Notice of Proposed Partnership Adjustment with an imputed underpayment well above what the actual partners would owe at their individual rates, the decision to request the alternative under IRC 6226 through Form 8989 was straightforward in theory – but the deadline was uncomfortably close by the time we analyzed all the numbers. Form 8989 is a form that rewards being organized early in the BBA audit process.

Download Form 8989 PDF

Key Takeaways

• What it does: Form 8989 is the IRS request a BBA Partnership Representative submits to revoke a previously made Section 6226 push-out election (originally elected on Form 8988). Approval ends the push-out and the partnership becomes liable for the imputed underpayment at the entity level under Section 6225, plus penalties and interest under Section 6233.
• Who files it: The partnership (through its partnership representative) files Form 8989 after receiving a Final Partnership Adjustment from the IRS, during the BBA audit proceeding.
• Critical deadline: Form 8989 must be submitted AND approved by the IRS before the partnership furnishes its Section 6226 statements to reviewed-year partners. Once those statements go out, the IRS will not approve the revocation – the operative cutoff is statement furnishing, not a fixed days-from-FPA window.
• Why it matters: The imputed underpayment uses the highest applicable tax rates (37% for individual income, 21% for corporate). Partners who are tax-exempt, in lower brackets, or have offsetting items may owe substantially less at their own rates.
• Effect of approval: Once Form 8989 is approved, the partnership becomes liable for the imputed underpayment under Section 6225, plus penalties and interest under Section 6233, as if the original Form 8988 push-out election had never been made. No Section 6226 push-out statements are furnished after the revocation is approved.
• SOP tip: Start the push-out vs. imputed underpayment analysis as soon as the Notice of Proposed Partnership Adjustment arrives – do not wait for the Final Partnership Adjustment to begin the decision process.

What Form 8989 Is and When to Use It

Under the BBA centralized partnership audit rules, when the IRS concludes a partnership audit with a Final Partnership Adjustment (FPA), the default outcome is an imputed underpayment paid by the partnership itself at the applicable highest tax rate. This is administratively simple but often economically unfair: current partners bear the cost of tax adjustments attributable to reviewed year partners who may have already exited the partnership.

Congress created an alternative mechanism under IRC Section 6226: the push-out election. Instead of the partnership paying the imputed underpayment, the partnership “pushes out” the audit adjustments to the reviewed year partners, who then take those adjustments into account on their own returns and pay any resulting additional tax. Form 8989 is the form the partnership representative files to REVOKE a previously made Section 6226 push-out election (originally elected on Form 8988). The §6226 push-out election itself is made on Form 8988 – Form 8989 then asks IRS approval to undo that election before §6226 statements are furnished to reviewed-year partners.

Why “Alternative to Penalties” Is the Form’s Label

The IRS originally framed the imputed underpayment payment as analogous to a penalty – it falls on the current partnership at the highest rate regardless of actual partner circumstances. The push-out election, by allowing tax to flow to partners at their actual rates, was described as an “alternative” to that default penalty structure. Form 8989's actual title is “Request to Revoke the Election for Alternative to Payment of the Imputed Underpayment” (Rev. October 2020). The form revokes a prior §6226 push-out election made on Form 8988 and returns the imputed underpayment liability to the partnership under Section 6225.

Who Benefits Most from Revoking the Election

Revoking the push-out election on Form 8989 is most valuable when the partnership concludes that paying the imputed underpayment at the entity level is the better outcome after all – for example, the reviewed year partner roster has become unreachable or the partnership has effectively dissolved, the cost and friction of locating partners and furnishing §6226 statements outweighs the partner-level tax savings, or a recomputation shows the partnership-level imputed underpayment under Section 6225 is no larger than the aggregate partner-level tax would have been. A quantitative analysis comparing the partnership-level imputed underpayment to the aggregate partner-level tax under the prior push-out election is the foundation of the revocation decision.

How to Complete Form 8989

Form 8989 is a procedural request form – it is not a computation form. Its primary purpose is to request IRS approval to revoke a previously made Section 6226 push-out election (originally elected on Form 8988) and to identify the partnership and the open BBA exam to which the revocation applies.

Section / Field	What to Complete	Practitioner Notes
Partnership Identification	Partnership name, EIN, tax year(s) under examination (the reviewed year)	Use the exact reviewed year, not the current tax year. The form relates to the year the IRS audited, not the year it is being filed.
Final Partnership Adjustment Information	Date the FPA was mailed, FPA document number or reference	There is no fixed days-from-FPA deadline for Form 8989. The operative cutoff is the date the partnership furnishes its Section 6226 statements to reviewed-year partners – once statements go out, the IRS will not approve the revocation. Document the FPA date for the file but plan around the statement-furnishing cutoff.
Partnership Representative Information	Name and contact information of the current partnership representative	The PR who signs Form 8989 must be the currently designated PR for the audit proceeding. Verify this before filing.
Revocation Statement	Statement requesting that the IRS approve the partnership’s request to revoke its previously made Section 6226 election (originally made on Form 8988)	The form includes a pre-printed revocation statement; do not alter its language. Any modifications may cause the IRS to reject the request.
PR Signature	Signature of the partnership representative and date	The PR has sole authority to file this revocation request on behalf of the partnership. Partner signatures are not required on Form 8989 itself, though they may be required under the partnership’s own governance documents before the PR acts.

Where and How to Submit Form 8989

Under IRC section 6241(10) and the current Form 8989 instructions, Form 8989 must be submitted electronically through the IRS BBA portal at irs.gov/bbapartnerships. Paper or certified-mail filing is not an accepted submission method. Retain a copy of the uploaded fillable PDF and the BBA portal confirmation. The hard cutoff is the date the partnership furnishes Section 6226 statements to reviewed-year partners – once statements go out, the IRS will not approve the revocation, no matter how the request was submitted.

Deadlines and Consequences of Missing the Window

The central compliance risk for Form 8989 is the Section 6226 statement-furnishing cutoff. The IRS will not approve a Form 8989 revocation request once the partnership has furnished §6226 statements to its reviewed-year partners, so the revocation must be both submitted and approved before those statements go out.

Event	Deadline	Consequence
Submit Form 8989 and obtain IRS approval	Before the partnership furnishes Section 6226 statements to its reviewed-year partners	Once §6226 statements are furnished, the IRS will not approve the revocation, and the prior push-out election remains locked in
Partnership pays the imputed underpayment under Section 6225	In the adjustment year, after the IRS approves the Form 8989 revocation	Once the revocation is approved, the prior push-out is undone – the partnership pays the imputed underpayment at the entity level, plus penalties and interest under Section 6233, as if the original election was never made. No Section 6226 push-out statements are furnished to partners.
IRS review of Form 8989	No fixed IRS timeline; IRS processes and confirms the revocation request	The partnership should follow up with the assigned agent to confirm the revocation request was received and approved, and to confirm the recomputed Section 6225 imputed underpayment, before closing the exam

The Push-Out vs. Imputed Underpayment Decision Framework

The decision to file Form 8989 should be based on a quantitative and qualitative analysis performed as early as possible in the BBA audit process – ideally starting when the Notice of Proposed Partnership Adjustment is received, not after the FPA is issued.

Quantitative Comparison

Start with the total imputed underpayment amount shown on the FPA. Then estimate the aggregate additional tax that reviewed year partners would owe if the adjustments were pushed out to them at their actual tax rates. If the aggregate partner-level tax is materially lower than the imputed underpayment, the §6226 push-out election (elected on Form 8988, not Form 8989) generates net tax savings for the overall group – and in that case the partnership should NOT file Form 8989 to revoke that election. The savings are most significant when the partner group includes tax-exempt organizations, trusts with low distributable net income, or individuals with significant capital loss carryforwards or other reviewed year offsets.

Operational and Relationship Considerations

Even when the tax math favors push-out, operational factors may counsel against it. Locating and furnishing statements to former reviewed year partners adds administrative burden. Partners who receive push-out statements must engage their own advisors to complete Form 8978 Schedule A, which creates cost and friction. If the partnership has dissolved or the partner list is unresolvable, push-out may be impractical regardless of the tax savings.

Penalty Abatement Alongside Push-Out

When the partnership also wants to pursue penalty abatement on any penalties associated with the FPA, neither the §6226 push-out election (Form 8988) nor a revocation of that election (Form 8989) eliminates the need for a separate penalty abatement request. The proceedings run in parallel. My practice is to align the Form 8989 revocation request and any penalty abatement request inside the same engagement timeline, with the Section 6226 statement-furnishing date locked as the hard cutoff for the revocation.

What Happens After the IRS Approves Form 8989

Filing Form 8989 is the beginning of the process, not the end. Once the IRS approves the revocation request, the prior Section 6226 push-out election is undone – the partnership is treated as if the original election was never made, and no Section 6226 push-out statements are furnished to reviewed-year partners.

The Partnership Pays at the Entity Level Under Section 6225

After approval, the partnership is liable for the imputed underpayment under Section 6225, plus any penalties and interest under Section 6233, exactly as if the push-out election had never been made (per IRS Form 8989, Rev. October 2020). The partnership pays the adjustment itself in the adjustment year rather than passing it through to reviewed-year partners. Confirm the recomputed imputed underpayment and the related interest accrual before the assigned agent closes out the exam.

Documenting the Revocation and Reconciling the File

For partnerships with complex partner rosters – including former partners, tiered structures, or high partner turnover – reconciling the file matters even though no partner statements go out. Retain the approved Form 8989, the BBA portal confirmation, the original Form 8988, and the IRS correspondence so the revocation, the §6225 liability, and the §6233 interest and penalties are fully supported if the engagement is later reviewed.

Common Mistakes That Slow Things Down

These come up across BBA examination engagements. Most are not technical accounting errors – they are documentation and signature mismatches that block the IRS from accepting the revocation request.

Practical Checklists You Can Reuse

The three checklists below are copy-paste ready for firm SOPs covering BBA examination engagements that reach the revocation decision point.

Keep 8989 Season From Stalling

Form 8989 work doesn't follow a calendar season. It moves on the BBA examination clock, which compresses around the Notice of Final Partnership Adjustment (FPA) and the deadline to furnish §6226 statements to reviewed-year partners. Miss that window and the IRS will not approve the revocation, no matter how strong the underlying case is (per IRS Form 8989, Rev. October 2020). The decision to revoke a push-out election is a partnership-level repricing event: the imputed underpayment shifts back to the entity under Section 6225, plus interest and penalties under Section 6233.

The fix is not faster filing. It is structured case management, so the revocation request is built, signed, and approved before the §6226 statements go out, with a documented record of the push-out versus partnership-level liability comparison sitting in the file.

• Track every open BBA exam to its FPA date and tag the §6226 statement furnishing deadline as the hard cutoff in your engagement workflow.
• Build the push-out vs. revoke comparison schedule (entity-level §6225 underpayment plus §6233 interest and penalties versus the cumulative reviewed-year partner allocations) before the election decision is filed.
• Standardize Form 8989 Line 1 through Line 5e completion against the partnership's e-file application record; the Partnership Representative or designated individual signature must match exactly, or the upload is rejected.
• Lock the Audit Control Number, the underpayment-type checkboxes (General, Specific, or both, with each Specific Imputed Underpayment listed separately), and the filename convention (50-character cap, A-Z, 0-9, hyphen, underscore only) into a single submission checklist.
• Re-download the latest fillable Form 8989 from the IRS forms and instructions page for every submission; older saved PDFs are rejected on upload, and printed-signed-scanned image copies are not accepted.

This is the structured execution model behind every BBA examination engagement we run. If your team is carrying open BBA exams without a documented revocation workflow, the Accountably U.S. tax outsourcing service handles the Form 8989 preparation, partner-side modeling, and electronic upload inside your existing audit timeline.

FAQs

What is Form 8989 used for?

Form 8989 is the IRS request a BBA Partnership Representative submits to revoke a previously made Section 6226 push-out election (originally elected on Form 8988). The push-out election itself is made on Form 8988 – Form 8989 then asks IRS approval to undo that election. Once Form 8989 is approved, the partnership becomes liable for the imputed underpayment at the entity level under Section 6225, plus penalties and interest under Section 6233, as if the original push-out election had never been made.

What is the deadline for filing Form 8989?

Form 8989 must be submitted AND approved by the IRS before the partnership furnishes its Section 6226 statements to reviewed-year partners. The operative cutoff is the date those statements are furnished, not a fixed days-from-FPA window. Once statements go out, the IRS will not approve a Form 8989 revocation, regardless of whether the partners have filed yet, and the prior §6226 push-out election remains locked in.

When does the push-out election save tax?

The push-out election saves tax when the aggregate additional tax that reviewed year partners would owe at their own rates is less than the imputed underpayment the partnership would owe at the highest applicable rates (37% for individuals, 21% for corporations). The savings are greatest when the partner group includes tax-exempt entities, partners in lower tax brackets, or partners with significant reviewed year offsets such as capital loss carryforwards or net operating losses.

What happens after Form 8989 is approved?

Approval of Form 8989 ends the previously made Section 6226 push-out election. The partnership becomes liable for the imputed underpayment at the entity level under Section 6225, plus penalties and interest under Section 6233, as if the original Form 8988 push-out election had never been made. The partnership does not furnish Section 6226 push-out statements after Form 8989 is approved – approval is what stops the push-out.

Can the push-out election be revoked after Form 8989 is filed?

Form 8989 IS the revocation request – it is filed precisely to undo a previously made Section 6226 push-out election. Once the IRS approves Form 8989, the push-out is revoked and the partnership becomes liable for the imputed underpayment under Section 6225 plus Section 6233 penalties and interest; no Section 6226 statements are furnished. The Form 8989 revocation must be submitted and approved before any §6226 statements are furnished to reviewed-year partners – after statements go out, the push-out is locked in and the IRS will not approve a revocation.