Ill STAT. 1010 PUBLIC LAW 105-34—AUG. 5, 1997 of any overpayment of tax) attributable to an adjustment referred to in subparagraph (A) and such assessment or collection or allowance (or any notice thereof) shall not preclude any notice, proceeding, or determination under subchapter B. "(C) PERIOD OF LIMITATIONS.—The period for- "(i) assessing any underpayment of tax, or "(ii) filing a claim for credit or refund of any overpayment of tax, attributable to an adjustment referred to in subparagraph (A) shall not expire before the close of the period prescribed by section 6248 for making adjustments with respect to the partnership taxable year involved. "(D) TIERED STRUCTURES.— If the partner referred to in subparagraph (A) is smother partnership or an S corporation, the rules of this paragraph shall also apply to persons holding interests in such partnership or S corporation (as the case may be); except that, if such partner is an electing large partnership, the adjustment referred to in subparagraph (A) shall be taken into account in the manner provided by section 6242. "(d) ADDITION TO TAX FOR FAILURE TO COMPLY WITH SECTION. — Tor addition to tax in case of partner's disregard of requirements of this section, see part II of subchapter A of chapter 68. "SEC. 6242. PROCEDURES FOR TAKING PARTNERSHIP ADJUSTMENTS INTO ACCOUNT. "(a) ADJUSTMENTS FLOW THROUGH TO PARTNERS FOR YEAR IN WHICH ADJUSTMENT TAKES EFFECT. — "(1) IN GENERAL.— If any partnership adjustment with respect to any partnership item takes effect (within the meaning of subsection (d)(2)) during any partnership teixable year and if an election under paragraph (2) does not apply to such adjustment, such adjustment shall be taken into account in determining the amount of such item for the partnership taxable year in which such adjustment takes effect. In applying this title to any person who is (directly or indirectly) a partner in such partnership during such partnership taxable year, such adjustment shall be treated as an item actually arising during such tsixable year. "(2) PARTNERSHIP LLVBLE IN CERTAIN CASES. —If— "(A) a partnership elects under this paragraph to not take an adjustment into account under paragraph (1), "(B) a partnership does not make such an election but in filing its return for any partnership taxable year fails to take fully into account any partnership adjustment as required under paragraph (1), or "CO any partnership adjustment involves a reduction in a credit which exceeds the amount of such credit determined for the partnership taxable year in which the adjustment takes effect, the partnership shall pay to the Secretary an amount determined by applying the rules of subsection (b)(4) to the adjustments not so taken into account and any excess referred to in subparagraph (C). "(3) OFFSETTING ADJUSTMENTS TAKEN INTO ACCOUNT. — I f a partnership adjustment requires another adjustment in a
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