4.24.21. Case Closings

(1) The requirement for filing Form 720, Quarterly Federal Excise Tax Return, applies separately to each tax, listed by IRS Number (IRS No.), on the face of the return. For filing purposes, IRS Nos. that are left blank are considered non-filed even if the taxpayer or collector signed, dated, and submitted to the IRS a Form 720 that was accepted by the agency.

(1) The Excise Tax Program is governed by policy statements and other internal guidance that apply to all IRS personnel regardless of operating division. The policy statements found in IRM 1.2.1, Servicewide Policy Statements, apply to all excise tax issues and examinations. Examiners should review these policy statements to properly perform their examination duties when closing cases.

(2) Delegation Order and Policy Statements by Process summarizes data contained in the applicable IRM sections under IRM 1.2.2, Servicewide Delegations of Authority, in a single, electronic source.

(3) IRM 4.24, Excise Tax, provides Servicewide instructions for all operating divisions with employees involved with the correct filing, reporting, and payment of excise taxes, as well as case closings. IRM 4.24 serves as the foundation for consistent administration of excise taxes by various IRS operating divisions. By providing one source of authority for all operating divisions, IRS greatly reduces philosophical and procedural inconsistencies.

(1) Director, Examination - Specialty Policy, is responsible for providing policy and guidance for Excise Tax Examination employees and ensuring consistent application of policy, procedures, and tax law to effect tax administration while protecting taxpayer rights.

(2) Director, Examination - Specialty Tax, is responsible for the delivery of policy and guidance that impacts the field and campus examination processes.

(3) Chief, Estate & Gift/Excise Tax Exam, is responsible for ensuring information about closing cases is communicated to and carried out by managers and examiners.

(4) Excise Tax Program managers and examiners should thoroughly familiarize themselves with case closings procedures and information contained in this IRM, as well as other resources, such as those listed in IRM 4.24.21.1.6.

(1) Program Goals - The information explained in this IRM describes case closing procedures that examiners must understand and apply in the performance of their job duties to close examination reports correctly, thereby increasing compliance. The processes and procedures provided in this IRM are consistent with the objectives or goals for Excise Tax Examination addressed in IRM 1.1.16.5.3.1, Excise Tax Examination.

(2) Program Reports - Information regarding the reporting of program objectives are included on, but not limited to Examination Headquarters Monthly Briefings, Program Manager Monthly Briefings, SBSE Examination Operational Reviews, and Business Performance Reviews. These reports provide reliable and timely information. Periodic program reviews are conducted to:

• Determine if procedures are being followed.

• Validate the policies and procedures.

• Identify and share best practices.

(3) Program Effectiveness - Program effectiveness is measured by the Exam Quality Review System (EQRS) staff, located in FSEQ, that supports the SBSE quality improvement program utilizing National Quality Review System (NQRS) to conduct independent case reviews from a statistically valid sample of examination case work. National, area, and territory trend analyses on the quality attributes establish baselines to assess program performance, identify opportunities to improve work processes, analyze causes for failure, assess the feasibility of possible solutions, and measure the success of quality improvement efforts.

(4) Annual Review - Program Manager, Excise Tax Policy, is responsible for reviewing information in this IRM annually to ensure accuracy and promote consistent tax administration.

(1) The following table contains terms and their definitions used throughout this IRM.

(2) Refer to Exhibit 4.24.21-1 for acronyms used throughout this IRM.

(1) Refer to IRM 4.10.1, Overview of Examiner Responsibilities, for guidance about the basic responsibilities related to taxpayer rights, employee contact information, oral and written communication, and the authority for conducting examinations that examiners should understand and apply in the performance of their duties.

(2) Refer to IRM 4.10.2, Pre-Contact Responsibilities, for guidance about required responsibilities and analyses that must be completed before an examination is initiated, actions that are necessary for pre-contact planning of the examination, procedural instructions for contacting the taxpayer, and scheduling the initial appointment.

(3) Refer to IRM 4.10.8, Report Writing, for guidance about the preparation of audit reports, details regarding the preparation of corrected reports, and discussion about issues that require special reports and forms.

(4) Refer to IRM 4.24.8, Examination Guidance for Excise Claims for Refund or Abatement, for general guidelines and report writing procedures for examiners and campus personnel who process claims for refund or credit.

(5) Refer to IRM 4.24.10, Appeals Referral Procedures, for information about closing unagreed cases (other than claims) to Appeals.

(6) Refer to IRM 4.24.17, Excise Summary Terminal Activity Reporting System (ExSTARS) Compliance Examination Procedures, for guidance about fuel terminal and carrier compliance examination letters and reports.

(7) Refer to IRM 4.24.20, Excise Tax Report Writing Guide, for guidance about examination report writing guidelines for examiners.

(8) Refer to IRM 4.24.25, Issue Management System (IMS), Notebook and Workpapers, for guidance about the preparation of workpapers that support accurate examination reports.

(9) The Taxpayer Advocate Service (TAS) may be of assistance to taxpayers experiencing economic harm, who are seeking help in resolving tax problems that have not been resolved through normal procedures or who believe that an IRS system or procedure is not working as designed. Publication 1546, The Taxpayer Advocate Service is Your Voice at the IRS, provides contact and additional information. For guidance, refer to the Taxpayer Advocate - Contact Us.

(10) The Taxpayer Bill of Rights (TBOR) lists rights that already existed in the tax code, putting them in simple language, and grouping them into 10 fundamental rights. Employees are responsible for being familiar with and acting in accordance with taxpayer rights. For additional information, refer to IRC 7803(a)(3) or to the Taxpayer Bill of Rights.

(1) For NQRS reviews, agreed and no change examinations are to be closed in 30 calendar days measured from the date the agreed report is received, or the date the no change status is communicated to the taxpayer, to the date the case is closed from the group and updated in Examination Return Control System (ERCS).

(2) For EQRS reviews, agreed and no change examinations are to be closed within 30 calendar days. The 30 days are divided as follows:

1. The examiner has 15 days to close agreed and no change examinations to the manager. The 15-day period begins on the earlier of the date the agreed report is received from the taxpayer or the date the no change status is communicated to the taxpayer. The 15-day period ends on the day the case is mailed to the manager and/or the IMS case file is updated for closing.

2. The manager has 15 days to close agreed and no change examinations from the group. The 15-day period is measured from the date the case is mailed to the manager or the IMS case file is updated to the manager to the date the case is updated to closing status on ERCS.

(3) The time frame is calculated beginning the day immediately following the occurrence of one of the events described immediately above.

(1) Agreed cases with unpaid deficiencies of $100,000 and greater are to be closed in 4 calendar days.

(2) The time frame is measured from the date the agreed report is received to the date the case is closed from the group and updated in ERCS.

(1) The examiner and manager have 20 calendar days to close an unagreed case measured from the earlier of:

• The date to respond to the 30-day letter, or

• The date the request for an Appeals conference is received from the taxpayer.

(2) The time frame is calculated beginning the day immediately following the occurrence of one of the events described immediately above.

(1) The case closing process requires a paper case file closing and a separate IMS electronic case file closing. The examiner will attempt to close both files at the same time.

(2) The examiner will include all key documents in the IMS case file. The examiner will also print and organize all key documents into the paper case file, which will be mailed to the manager for further processing. Key documents should include, but are not limited to, workpapers or supporting documentation (or portions thereof) detailing all proposed adjustments. The examiner will index all key documents in the IMS case file in a similar fashion to those in the paper case file. The examiner must apply judgment regarding what information is necessary to include in both the IMS case file and paper case files.

(3) Specific naming conventions must be used for all documents in the IMS case file. Naming conventions contribute to an organized case file and assists users in easily locating specific documents.

(4) All documents must follow the Excise Workpaper Naming Convention Quick Guide. Refer to IRM 4.24.21-2, Excise Workpaper Naming Convention Quick Guide.

• Workpaper Series (see example 1 below)

• Workpaper/ Document Name (see example 1 below)

• Supplemental documents must use the prefix associated with that section plus a numeric page number (see examples 2 and 3 below).

Example: 1 - An examiner is assigned a paid claim CRN 360 case for IRS No. 060 (issue 1). In addition, the examiner has expanded the scope of the examination to the federal excise tax paid for IRS No. 060 (issue 2). The issue 1 lead sheet would be named "F001 060 Paid CRN 360 Diesel Fuel Lead Sheet," and the supporting workpaper/document would be named "F002 060 Paid CRN 360 Diesel Fuel Workpaper." The issue 2 lead sheet would be named "G001 060 Diesel Fuel Lead Sheet," and the supporting workpaper/document would be named "G002 060 Diesel Fuel Workpaper."

Example: 2 - Supplemental documents for "A125 Initial Interview Questions and Notes" would be named "A125-02 Org Chart" and "A125-03 Prior Exam Report."

Example: 3 - Supplemental documents for "B200-1 Required Filing Checks Prior/Subsequent Period Returns, Related Excise Tax Returns, Filing Verification" would be named "B200-1-02 IDRS Transcripts."

(5) The manager will review the closed case upon receipt. Review of the case will include a comparison by the manager of the paper case file to the IMS case file. If any inconsistencies exist, the manager will return the case file to the examiner for correction. The manager will document all closing actions in IMS on Form 9984 or the Case Level Activity Record in IMS. If the manager added or changed any documents, those documents must be uploaded or saved in the IMS case file and printed for the paper case file.

(6) The status of the IMS case file must be updated to "closed" by the examiner but not until it reaches either Status "51" or Status "52" on ERCS. The manager has the discretion to determine when to close the IMS case file. When this occurs, the manager must then complete the managerial actions in IMS. After the manager completes the review of the case, the paper case file should be mailed to CCP or Tech Services for further processing and final closing.

(1) The examiner must verify that the correct statute of limitations (SOL) date for assessment of tax is reflected on all transcripts. Transcripts must be less than 30 days old but preferably less than one week old.

(2) The examiner must include the following IDRS transcripts in the closed case:

• AMDIS

• AMDISA for each period - attached to the inside left of the case file folder

• BMFOLT (reflecting the most current module activity) - attached to the back of the return facing outward (for filed returns)

• INOLES - attached to the inside left of the case file folder

• CFINK, if there is a representative - attached to the bottom of the first page of the filed return (or BMFOLT for an SFR) facing outward

• TXMODA (current within 30 days of closure) - attached to the back of the filed return (or BMFOLT for an SFR) facing outward

  Note: An original return should be used when appropriate. TXMODA may not always be present for a return. For example, TXMODA is not present for an SFR. In some situations, TXMODA may not be present for a filed return. If TXMODA is not present, the examiner should substitute BRTVU for TXMODA.

(1) The examiner is responsible for completing Form 3198, Special Handling Notice for Examination Case Processing. It provides closing instructions to CCP and Tech Services, and is prepared in IMS.

(2) After the examiner enters specific data into IMS, Form 3198 will automatically populate. This will generally result in improved accuracy. The examiner will need to manually complete the remaining applicable fields and itemize the closing data on Form 3198.

(3) The examiner will provide instructions to CCP or Tech Services on Form 3198 and indicate the required letter, form, report, or other materials to enclose in correspondence to the taxpayer based on the type of closure. Refer to IRM 4.24.21.5 for additional guidance.

(4) For closing letters, the examiner must prepare an envelope addressed to the taxpayer and, if applicable, to the POA. Envelopes must contain the examiner's return address and should be included in the case file with the applicable letters.

(5) For cases with agreed and unpaid deficiencies or overassessments of $100,000 and greater, Form 3198 must be flagged in the "Expedite Processing" section by checking the "Over $100,000 Agreed and Unpaid" box.

(6) For cases involving claims or certain overassessments, examiners must determine if restricted interest applies. If restricted interest applies, then Form 3198 must be documented appropriately. Refer to IRM 4.24.8.25, Restricted Interest, for additional information on restricted interest and procedures for documenting Form 3198 when restricted interest applies.

(7) If Form 3198 is not annotated correctly with all closing actions, the case closing may be delayed, and the case returned to the group for additional closing actions.

(8) Refer to the Excise Tax Knowledge Base Homepage, Excise Examination shelf at Closing an Examination book for Type of Closure chapter at the Survey page, No Change Reports page, Agreed and Partially Agreed/Excepted Agreed Examinations page, and Unagreed Case page for model copies of completed Forms 3198.

(1) Form 5344, Examination Closing Record, serves as an input document for the Audit Information Management System (AIMS), which captures the closing information on examined cases. The system also transmits Form 5344 adjustment information to Master File to update taxpayer account records.

(2) The examiner must generate Form 5344 in IMS. It automatically populates when data is entered on the "IMS Entity Closing Data" tab. After the examiner has verified Form 5344 is properly completed, then the examiner must click "“Submit to IMS."

(3) Refer to the Excise Tax Knowledge Base Homepage, Excise Examination shelf at Closing an Examination book for Type of Closure chapter at the Survey page, No Change Reports page, Agreed and Partially Agreed/Excepted Agreed Examinations page, and Unagreed Case page for model copies of completed Forms 5344.

(4) For SFR cases, write "SFR/Original Return" in the top margin of Form 5344. Refer to IRM 4.4.9.5.3.1.1, Prepare Case for Closing, for guidance.

(1) Form 5351, Examination Non-Examined Closings, is used as an input document to close non-examined cases, such as when cases are surveyed to remove them from AIMS.

(2) The examiner must generate Form 5351 in IMS. Refer to IRM 4.24.21.5.1 for additional guidance on generating and preparing Form 5351.

(3) Refer to the Excise Tax Knowledge Base Homepage, Excise Examination shelf at Closing an Examination book for Type of Closure chapter at the Survey page for a model copy of a completed Form 5351 for a Survey After Assignment.

(1) Form 4665, Report Transmittal, (also known as the transmittal letter or T-Letter) is used in unagreed and partially agreed cases. It is not required in agreed cases but may be used if deemed necessary by the examiner.

(2) In unagreed and partially agreed cases, Form 4665 must summarize the unagreed issues, if necessary, and indicate when the taxpayer was offered the opportunity to discuss the unagreed issues with a manager. Information included on Form 4665 should complement and not repeat information in the report and workpapers.

(3) Form 4665 must not contain statements or comments intended to influence Appeals’ decision-making process. This includes recommendations concerning what Appeals should consider and how Appeals should resolve the case. It is permissible to include a neutral list of unagreed issues, without discussion, and indicate which ones, if any, are coordinated issues.

(4) If Form 4665, or other similar document, includes statements or comments that may be considered as prohibited "ex parte communications," or includes prohibited communications, regardless of whether such content is included as part of a document that is either placed on top of the case file as a transmittal or inserted into the case file in conjunction with preparing the case for transmission to Appeals, the Form 4665 or document must be shared by the examiner with the taxpayer and representative at the time the case file is sent to Appeals.

(5) Form 4665 can also be used to request a pre-conference with Appeals. Refer to IRM 4.24.10.9, Appeals Pre-conference Procedures.

(6) For additional procedures relating to Form 4665, refer to IRM 4.24.10.8, Transferring an Excise Tax Examination Case to Appeals.

(1) If the taxpayer has not been contacted, taxpayer books and records have not been inspected and an examination will most likely not result in a material change to the taxpayer’s tax liability, the examiner may survey the return after assignment by completing Form 2503, Survey After Assignment - Excise or Employment Tax, and Form 5351, Examination Non-Examined Closings.

(2) The examiner must prepare Form 2503 and Form 5351 in IMS by completing the following steps:

1. In the "Edit Entity" window in IMS, under the "ERCS Data" tab, select disposal code (DC) "32."

2. In the "Returns" window in IMS, select "Add New Return Document" and select "Form 5351" from the drop down.

3. In the "Add ERCS Survey Data"” window, select the applicable Survey Reason Code (SRC) and complete the "Additional Information" field with an explanation justifying why the case is being surveyed after assignment. Below the "Additional Information" field, select "Form 2503" from the "Survey Form" drop down and complete applicable sections.

4. IMS will generate a Form 2503 and Form 5351 populated with data entered by the examiner. Review Form 2503 and Form 5351 and verify that the necessary data fields were populated correctly. Form 5351 must have the appropriate taxpayer’s name control, TIN, MFT, period, DC, and Requester/ EGC/ Date.

5. Submit Form 2503 and Form 5351 to the manager in IMS by selecting "Edit Return Document Status" and selecting "Submitted for Approval" from the "Form Status" drop down.

(3) If the manager concurs with the examiner’s determination to survey the case after assignment, then the manager will approve Form 2503 and Form 5351 via the IMS Team Website.

(4) The examiner will close the case in IMS after manager approval of Form 2503 and Form 5351 using the paper survey procedures in IRM 4.24.21.5.1.1, or paperless survey procedures in IRM 4.24.21.5.1.2.

(5) To support the decision to survey the return after assignment, the examiner must ensure the case file has been documented with all actions taken, which led to this conclusion, including, but not be limited to, consideration of Large, Unusual or Questionable items, completion of required filing checks, consideration of collectibility, evaluation of audit potential, repetitive audits, and other materials that influenced the examiner’s decision.

(6) Paper surveys are required for unpaid claims and cases with original returns in the case file. If not required, paperless survey procedures can be utilized. Refer to IRM 4.24.21.5.1.2 for guidance.

(7) The examiner should stamp the face of the return or a paper copy of the Business Transactions File View (BRTVU) with the message "Closed Survey After Assignment," "Examiner’s Signature and Date," and "Approved - Manager’s Signature and Date." If a stamp is not available, the message may be handwritten. The examiner should sign and date the message. The manager should do the same.

(8) When a return is surveyed before assignment DC "31" is used by a manager. When a return is surveyed after assignment DC "32" is used by an examiner.

(9) Refer to the IRM 4.24.8.9, Unpaid Claims - Survey After Assignment, and/or the Excise Tax Knowledge Base Homepage, Excise Examination shelf, Closing an Examination book, Type of Closure chapter at the Survey page for more information about closing forms and procedures for surveying excise claim cases.

(1) If the taxpayer agrees to all proposed adjustments, the case is closed using the agreed closing procedures below.

(2) To process an agreed examination, the examiner should take the steps itemized below:

1. Generate Form 5344 in IMS and verify that all required fields are completed and accurate.

2. Prepare Letter 987-X, Agreed Excise Tax Change, which will be signed by the manager on behalf of the Chief, Estate & Gift/Excise Tax Exam and left in the case file. It will be dated and mailed to the taxpayer by CCP.

3. On Form 3198, check the appropriate letter box on page 2 under "Letter Instructions for CCP."

(3) DC "03" is used for returns closed agreed prior to issuance of the 30-day letter, while DC "04" is used for returns closed agreed after issuance of the 30-day letter.

(4) Refer to Excise Tax Knowledge Base Homepage, Excise Examination shelf, Closing an Examination book, Type of Closure chapter at Agreed and Partially Agreed/Excepted Agreed Examinations page for additional guidance about closing forms, letters, and procedures for agreed excise cases where the taxpayer fully agreed to all proposed adjustments.

(1) If the taxpayer does not agree to all the proposed adjustments, but will agree to some of the proposed adjustments, the case is partially agreed.

(2) In a partially agreed case, the agreed report must first be closed by following the partial assessment procedures in IRM 4.24.21.5.7.

(3) After the agreed report is processed using partial assessment procedures, the examiner can proceed with the unagreed case closing. Refer to IRM 4.24.21.5.6 for unagreed case closing procedures.

(4) In addition, Form 4665, Report Transmittal, must be prepared for all partially agreed cases with the details of the agreed and unagreed issues. Include Form 4665 in the case file but do not issue it to the taxpayer. Refer to IRM 4.24.21.4.6 for additional guidance.

(5) Refer to IRM 4.10.8.5, Excepted Agreed Cases, and IRM 4.10.8.6, Partially Agreed Cases, and the Excise Tax Knowledge Base Homepage, Excise Examination shelf, Closing an Examination book, Type of Closure chapter, at the Agreed and Partially Agreed/Excepted Agreed Examinations page for more information about closing forms, letters and procedures for agreed cases where the taxpayer partially agreed or excepted agreed to proposed adjustments.

(1) If an examination of the books and records for a filed return results in the examiner determining that no adjustment exists for the IRS No. examined, no change closing procedures must be followed.

(2) To complete a no change examination, the examiner will:

1. Complete Form 3198, in IMS and enter DC "02" for no change, or DC "01" for no change with adjustments.

2. On Form 3198, check the "No Change Letters" and "Letter 590 (straight N/C)" boxes under the letter instructions for CCP.

3. Complete Form 5344, Examination Closing Record, in IMS and enter "zero" or "(0)" on line 404d.

4. Prepare Letter 590-X, No Change - Final, which will be signed by the manager for the Chief, Estate & Gift/Excise Tax Exam and left in the case file. It will be dated and mailed to the taxpayer or collector by CCP.

(3) If the taxpayer or collector has a no change for the IRS No. examined, no further action is generally required regarding Form 720 filing requirements.

(4) Submit the case file to the manager for review and closure to CCP.

(5) The manager will review the case file and, if in agreement with the no change, sign Letter 590-X, and leave the letter in the case file.

(6) Refer to Excise Tax Knowledge Base Homepage, Excise Examination shelf, Closing an Examination book, Type of Closure chapter at the No Change Reports page for more information about no change examinations.

(1) If a taxpayer did not file a return and the examiner determines the taxpayer is not liable for any excise taxes, then no liability SFR non-filer procedures must be followed.

(2) If a taxpayer or collector files a Form 720 but does not enter information next to an IRS No. on the face of the document, then that is considered a "non-filed" return. These returns must be worked as no liability SFR non-filer cases whenever the examiner determines no adjustment exists for the IRS No. examined.

(3) No liability SFR non-filer cases are to be closed using DC "02." This applies only to cases where the examiner has taken actions that may include, but are not limited to, conducting an interview, reviewing books and records, and ultimately making the decision the taxpayer is not liable for excise taxes.

(4) Closing out the IMS case file and the paper case file to CCP requires the actions described in the paragraphs that follow.

(5) Procedures for Letter 930, Non-Filer No Liability Substitute for Return (SFR) Transmittal Letter:

1. The examiner must prepare an original and a copy of Letter 930 advising the taxpayer there is no liability for the excise tax indicated, as well as an envelope addressed to the taxpayer.

2. Letter 930 will be signed by the manager on behalf of the Chief, Estate & Gift/Excise Tax Exam.

3. The examiner will note under the "Letter Instructions for CCP" section on Form 3198 "Other Instructions" box, "No Liability SFR - Issue Letter 930 to the taxpayer."

4. CCP ensures the original letter is mailed to the taxpayer and the copy remains in the paper case file.

(6) IMS case closing:

1. Established no change IMS case closing procedures are followed for no liability SFR non-filer cases, including all case documentation that is in the paper case file.

2. Both the IMS case file and the paper case file must contain documentation to support the no liability determination.

3. The IMS case file serves as the historical record for all examiner actions, findings, and determinations that is essential background, if that case is subsequently identified and/or classified.

(7) At a minimum the paper case file, as well as the IMS case file, will contain:

1. BMFOLT for the periods involved that shows the transaction code 150 posting for the SFR

   Note: The examiner should also check TXMODA to ensure there are no pending transactions

2. AMDISA to show the module is fully established on AIMS

3. Letter 930 (two copies) with proper signature and an addressed envelope with current taxpayer address

4. Form 3198

5. Form 5344

6. Supporting documentation explaining the reasons for the no liability SFR non-filer closure, such as Form 9984 and any lead sheets or workpapers

   Note: If an SFR examination results in a decision that the taxpayer is not liable for an excise tax in the period examined, no examination report is required. Letter 930 is all that is necessary because the taxpayer did not file an excise return.

   Note: Not all mandatory workpapers are required for a no liability case.

(8) If the taxpayer is not liable for any excise tax for the same MFT examined, the examiner will prepare Form 3177, Notice of Action for Entry on Master File. This is necessary to release the expectation the taxpayer should file returns.

1. If the taxpayer is not liable for the period(s), enter "590" in the TRC column and "Closing Code 75" in the "Other" space provided under the Explanation column.

2. If the taxpayer is not liable for the period(s) and will not be liable for any subsequent period(s) for the same MFT examined, enter "591" in the TRC column and "Closing Code 75" in the "Other" space provided under the Explanation column.

   Note: On Form 3198 in the "Forms Enclosed" section, the examiner must check the "Form 3177" box to indicate that Form 3177 is in the case.

(1) If the taxpayer does not agree to the proposed adjustments, then the case is closed using unagreed closing procedures.

(2) If a taxpayer requests an Appeals conference, the examiner must determine if the case meets the requirements for an Appeals referral in IRM 4.24.10.2, Prerequisites for an Appeals Referral.

(3) If the unagreed case is eligible for Appeals consideration, then closing procedures in IRM 4.24.10.7, Case Routing Procedures for Unagreed Excise Tax Examination Cases to Appeals, and IRM 4.24.10.8, Transferring an Excise Tax Examination Case to Appeals, must be followed.

(4) If the unagreed case is not eligible for Appeals consideration, then the case is closed to CCP using DC "08." This includes unagreed cases that have less than 365 days remaining on the statute when it is projected to be received in Appeals, or cases where the taxpayer did not timely respond to a 30-day letter, which requires an assessment.

(5) Refer to Excise Tax Knowledge Base Homepage, Excise Examination shelf, Closing an Examination book, Type of Closure chapter at the Unagreed Case page for more information about closing forms, letters, and procedures for more information about closing unagreed cases where the taxpayer disagrees with the proposed adjustments and either did not file an acceptable protest, or the SOL will not have 365 days remaining on the case when the case is expected to be received at Appeals and the taxpayer will not or cannot extend the SOL.

(6) In unagreed SFR cases not going to Appeals and for which the Failure to Pay penalty is assessed, IRC 6020(b) certification procedures must be followed. Refer to IRM 4.24.9.6, Certification Procedures for Non-Filed Excise Tax Returns, for guidance.

(1) (1) This section provides guidance for cases requiring the following types of expedited assessments:

• Partial assessments

• Quick assessments

(2) A partial assessment is required for the following:

• Partially agreed cases, where the unagreed issues will be closed to Appeals, and

• Unagreed paid claim assessments that fall under IRC 6206, where the taxpayer has requested an Appeals conference, and the SOL has 445 days or less, but more than 60 days remaining.

  Note: Partial assessment procedures do not apply to no change or overassessment cases, except for those applicable overassessment situations outlined in IRM 4.10.8.6.1, Partial Overassessments.

(3) Quick assessments are required when an assessment must be made expeditiously to protect the Government’s interest. In these instances, the assessment is made manually (directly on master file).

(4) A quick assessment, or manual assessment, is limited to the following cases:

• Imminent Statute: 60 days or less remaining on the SOL or in cases where the assessment of taxes or credits is in jeopardy.

• Agreed Unpaid Deficiency over $100,000: Deficiencies over $100,000 which are agreed and unpaid, that will not be received in CCP for final closure within 30 days of the agreement date.

Note: The $100,000 criteria is not cumulative but is determined per period. Refer to IRM 4.4.18.7, Processing Agreed and Unpaid Deficiencies, for guidance.

(5) When a case has an imminent statute date that requires a quick assessment, the examiner must contact the Cincinnati CCP Field Liaison to notify them that a quick assessment will be needed on the case. Contact information can be found at Contacts for FORT (Field Office Resource Team).

(6) Form 3198 must be completed with following information:

• For cases with less than 90 days remaining on the SOL: In the Expedite Processing section, check the box "Statute Less Than 90 days."

• For partial assessments: In the Special Features section, check the boxes "Partial Assessment Requested" and "Other Instructions." Next to "Other Instructions" enter the following: "Return via fax when completed."

• For quick assessments: In the Special Features section, check the box "Other Instructions." Next to "Other Instructions" enter the following: "QUICK ASSESSMENT REQUIRED. Return via fax when completed."

  Note: Do not complete the bottom of page 1 or page 2 of Form 3198 unless the quick assessment is being processed as a final case closing.

• If the quick assessment is being processed as a final case closing, complete the additional procedures in paragraphs 10 through 12 of this section.

  Note: If the case is not ready for final closure, the case must remain in status "12" (do not update to status "51").

(7) Form 5344 must be completed for each period. The following procedures apply to the Form 5344 completion:

• Enter the amount of the partial agreement or the amount of the quick assessment in Item 12 and Item 15.

• For partial assessments: Enter the appropriate disposal code in Item 13.

  Note: For unagreed cases going to appeals, disposal code "07" is not input until the case is ready for final closure from the group.

• If the quick assessment is being processed as a final case closing, complete the additional procedures in paragraphs 10 through 12 of this section.

  Note: Do not complete the right side of page 1 or the entire page 2 of Form 5344 unless the quick assessment is being processed as a final case closing.

  Note: Additional guidance for processing quick assessments is found in IRM 4.4.25, Quick Assessments. Additional instructions for processing partial assessments are found in IRM 4.4.12, Examined Closings, Surveyed Claims, and Partial Assessments.

(8) Fax the partial assessment or quick assessment package to CCP for assessment at (855) 386-5122. The subject line of the e-fax must state "Partial Assessment Request" or "Manual Assessment Request." The package must consist of the following:

• Form 3198

• Form 5344

• Applicable Examination Report

  Note: A signed Form 5384, Excise Tax Examination Changes and Consent to Assessment & Collection, or Form 2504-E, Agreement to Assessment and Collection of Additional Tax and Acceptance of Overassessment, is sent for agreed cases, a signed Form 2504-E is sent for partially agreed cases, and a Form 5385, Excise Tax Examination Changes, is sent for unagreed cases.

• Form 8278 (if applicable)

(9) CCP will:

• Acknowledge the request within 48 hours of receipt.

• Make the partial assessment or quick assessment within 5 business days.

• Fax the originator copies of Form 5344 marked "Request Completed" to the group for association with the case file to verify the assessment was completed.

(10) When the case is ready for final closure, examiners must follow regular closing procedures, based on the type of closure described in this IRM section or in IRM 4.24.8.

(11) In addition to regular closing procedures, when the case is ready for final closure, Form 5344 must be completed as follows:

• Enter the DC based on the final case disposition of the remaining issues.

• Enter any additional adjustments after the processing of the partial assessment in Items 12 and 15 of Form 5344.

  Note: If the final closing is to Appeals, Item 12 must be left blank and the unagreed amount entered in Item 18 must not include the amount of tax previously assessed as a partial assessment.

• Enter a TC "300" with a zero amount in Item 12 of Form 5344 for periods where there is no additional assessment after the processing of the quick assessment or partial assessment.

• Enter the net of all adjustments that were processed using the quick assessment procedures in Item 35 of Form 5344. If more than one quick assessment has been processed, ensure that this entry is the total of all quick assessments processed.

(12) In addition to regular closing procedures, when a case is ready for final closure, Form 3198 must be completed as follows:

• Enter the DC based on the final case disposition of the remaining issues.

• On Form 3198 under the Special Features section, check the box "Final Closure - partial assessment previously completed."

(1) Review the completed case, including but not limited to, Form 3198, Form 5344, and workpapers or supporting documentation (or portions thereof) detailing all proposed adjustments.

(2) Review of the case will include a comparison of the paper case file to the IMS case file. If any inconsistencies exist, return the case file to the examiner for correction. If any documents were added or changed, those documents must be uploaded or saved in the IMS case file and printed for the paper case file.

(3) At a minimum, review the current AMDISA, TXMODA, BMFOLI, BMFOLR, BMFOLT, CFINK, and INOLES (less than 30 days old) to verify the accuracy of the balance on the account, all prior assessments have been acknowledged and used in computations, and to confirm the correct SOL is being used in all systems, reports, and case closing documents.

(4) After a review of the case file and if in agreement, sign any applicable closing letters.

(5) Review and close the case within the recommended national time frames.

(6) After the review is completed, the secretary or designated group closing official will update the status of the case in ERCS to status "21" or "51" and the case will be shipped to Tech Services or CCP for closure. Changing the status in ERCS to status "21" or "51" should be the last update prior to mailing the paper case file.

(7) Ensure all IMS required closing actions are completed when the case is closed from the group. For additional guidance on IMS, refer to IRM 4.24.25.2, Issue Management System (IMS), and at LB&I Source, Technology chapter, LB&I Systems book, at the Issue Management System page for specific IMS areas of interest, such as IMS Help, IMS Team Website, and IMS Frequently Asked Questions.

(1) Document Form 9984 or Case Level Activity Record in IMS with (but not limited to) the following:

• Actions taken for case review

• Actions taken for closing actions

• The date the case file was closed from the group to CCP or Tech Services

• Explanation of all delays (i.e., shipment of the paper case file, remote manager travel, etc.) from the date the case is closed to the manager to the date the case is closed from the group

  Note: When there are gaps that exceed the recommended national time frames for taking actions, refer to IRM 4.24.21.3(4).

(1) Determine the grade of case for all examination cases.

(2) Refer to IRM 1.4.40, Resource Guide for Managers - SB/SE Field and Office Examination Group Manager, and Document 6036, Examination Division Reporting Codes Booklet, for more information about recording grade of case on Form 5344.

(3) The case grading guidelines may be used at any point in the examination process. However, at assignment, only the excise return information will be available. Development during the examination may more fully disclose the final grade of case. Final grading factors take into account excise return information, workpapers, and the examination report. Thus, the final grade may differ from grade at assignment. The final grade is entered in box "32" on Form 5344.