AICPA proposes simplification to AAR Process

The professional body is recommending instruction changes and new attachments to the process

The American Institute of CPAs (AICPA) has submitted recommendations to the Internal Revenue Service (IRS) to “simplify and improve” the administrative adjustment request (AAR) process.

The professional body’s recommendations are being referred to as Form AAR-EZ and provide a framework going forward for the administrative process.

Among the recommended proposals are instruction changes, new clarifications and additional attachments to improve the process.

In a statement, AICPA said: “Completing and filing AARs can be a time-consuming, administrative burden for partnerships and practitioners.

“Making minor adjustments to previously filed partnership returns, including those that are not relevant in determining the tax liability of any partners, is unreasonably difficult due to the complexity of the AAR process.”

It added: “The proposed AAR-EZ would provide short and long-term solutions to correct minor administrative errors that occur when completing partnership tax returns, such as a transposition error in a partner’s social security number or address on an issued Schedule K-1.

“This would alleviate bottlenecks and resource constraints, streamline the AAR process and increase compliance.”

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