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I believe that the partner could take a deduction on the pension cost to his staff, but he is unable to get an allocation and a corresponding deduction.

No wiggle room. No amendment, can't treat it as optional withholding. Or, what he said.

Interesting. I'd have said the opposite from the CPA. Has the CPA given an explanation for the position taken?

Withholding isnt determined by the document though, it determined by the Code. In order for the plan to treat a distribution as a CRD, it has to amend for CARES. The reason you have voluntary withholding on a CRD is because it is not treated as a rollover eligible distribution. Absent an amendment, the distribution in question (and most other distributions) would be rollover eligible and would require 20% withholding and 402f notice. I don't see any room for maybe here. Whether they would enforce the penalties for failure to provide notice and withholding is a different matter.

It depends on what you mean by implementing CARES Act Provisions. A plan that has not adopted any of the additional distribution options available under the CARES Act can, but is not required to, choose to treat distributions to qualified individuals as COVID related distributions, as long as it is applied consistently. What does the plan want to do? Notice 2020-50, Section 2C: https://www.irs.gov/pub/irs-drop/n-20-50.pdf