Common use of Risks Of Audit And Adjustment Clause in Contracts

Risks Of Audit And Adjustment. A private letter ruling from the Service has not been obtained with respect to any of the federal income tax considerations associated with an investment in the Partnership. Certain federal income tax positions taken by the Partnership may be challenged upon audit by the Service. Any adjustment to the Partnership's return resulting from an audit by the Service would result in adjustments to the tax returns of each Limited Partner and might result in an examination of items in such returns unrelated to the Partnership or an examination of tax returns for prior or later years. Moreover, the Partnership and Limited Partners could incur substantial legal and accounting costs in contesting any Service challenge, regardless of the outcome. The General Partners generally will have the authority and power to act for and bind the Partnership in connection with any such audit or adjustment for administrative or judicial proceedings in connection therewith.