4.70.11. Administrative Matters

(1) The Tax Exempt & Government Entities (TE/GE) Division serves charities and non- profits, small local community organizations, major universities, large pension funds, small business retirement plans, federal, state, and local governments, participants in complex tax-advantaged bond transactions, and Indian tribal governments and their entities. The overall TE/GE examination program’s goal is to promote the highest degree of voluntary compliance with:

• The statutes governing qualification of plans and exemption of certain types of organizations.

• The federal return filing requirements of certain types of organizations within TE/GE’s jurisdiction.

• Reporting the "substantially correct" tax liability.

  Note: IRM 1.2.1.5.36, Policy Statement 4-119 (Rev. 1), Selection and Examination of Returns.

  Note: For purposes of this IRM, any reference to tax advantaged bonds included tax exempt bonds, tax credit bonds, and direct pay bonds unless otherwise specified.

(2) This IRM provides an overview of the responsibilities that examiners should understand and apply in the performance of their duties in executing the TE/GE examination process.

(3) Examination of exempt organizations will be conducted to determine whether such entities meet continued qualification of exempt status, compliance and the causes of noncompliance with the tax laws and applicable resolutions.

(4) Examination of employee benefit plans is regulatory, with emphasis on continued qualification of employee benefit plans. The IRS selects and examines returns to:

• Promote the highest degree of voluntary compliance with the tax laws governing plan qualification.

• Determine the extent of compliance and the causes of noncompliance with the tax laws and applicable resolutions.

• Determine whether such plans meet the applicable qualification requirements in operation.

(5) Examination of governmental entities will be conducted to determine whether such entities are in compliance with their employment tax filing, reporting, and payment requirements.

(6) The Tax Exempt Bond Examination Program is to identify and correct noncompliance in tax-advantaged bonds.

(7) TE/GE Examiners should refer to IRM 4.23.3, Exam Program and Procedures when examining employment tax cases in addition to this IRM section.

(8) The procedures contained in this IRM are not intended to be all inclusive. Examiners must use their professional judgment in completing their exam cases and other compliance activities.

(9) For ITG:

1. The IRS is governed by consultation policies that may be adopted by the Department of the Treasury. ITG continues this dialogue to ensure we constantly evolve to reflect tribal, the IRS, and stakeholder needs.

2. The Treasury Department has a consultation process to dialogue with Indian tribes on a government-to-government basis. This allows better understanding and response to their needs on Treasury regulations, legislative comments, proposed legislation and policy statements that have Tribal implications, impacts Tribal economy or preempt Tribal law. The Treasury Department’s Office of the Assistant Secretary for Management & Budget is responsible for coordinating consultation between the Indian and Treasury Department bureaus and offices. Please use the e-mail below to contact the Treasury’s official point of contact for tribal consultation if you have any questions, concerns or comments.

(1) Examinations are conducted according to Policy Statement 1-236 (IRM 1.2.1.2.36), Fairness and Integrity in Enforcement Selection, and the Taxpayer Bill of Rights per IRC 7803(a)(3). 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 accord with taxpayer rights. See IRC 7803(a)(3), Execution of Duties in Accord with Taxpayer Rights. For additional information about the TBOR, see https://www.irs.gov/taxpayer-bill-of-rights.

(2) Policy Statement 4-4 (IRM 1.2.1.5.2) provides package audit requirements, that:

1. Income tax examinations will include consideration of employment tax liability.

2. If warranted, employment tax returns will be examined concurrently with the income tax examination.

3. The examination of any return will include a check for filing other federal tax or information returns required to be filed.

(3) Under Policy Statement 4-117 (IRM 1.2.1.5.34), examiners and managers:

1. Have broad authority to consider and weigh conflicting information, data, and opinions.

2. Use professional judgement when applying examination standards for findings of fact and application of tax law to determine the correct tax liability.

3. Exercise authority to get the greatest number of agreements to tax determinations without sacrificing the quality or integrity of those determinations.

4. Resolve tax differences at the lowest level.

(4) Policy Statement 4-119 (IRM 1.2.1.5.36) provides that the primary objective of the TE/GE program is regulatory, with emphasis on the continued qualification of exempt organizations and employee benefit plans, and continued compliance of governmental entities (federal, state, and local governmental entities, Indian tribal governments and tribal entities, and entities or organizations that issue tax advantaged bonds). The IRS selects and examines returns to:

1. Promote the highest degree of voluntary compliance with the statutes governing qualification of plans and exemption of certain types of organizations from tax.

2. Determine the extent of compliance and the causes of noncompliance with the tax laws by plans, organizations, and governmental entities.

(5) IRC 7602 gives examiners the authority to:

1. Examine any books, papers, records or other data necessary to complete an examination (includes electronic media).

2. Issue a summons for information necessary to complete an examination.

3. Take testimony under oath to secure additional information needed.

4. Ask about any offense connected to administering or enforcing the Internal Revenue laws.

(6) IRC 7605 - Time and Place of Examination. Gives examiners authority to choose the time and place of the examination as is reasonable under the circumstances.

(7) IRC 7803 - Commissioner of Internal Revenue; Other Officials. Execute duties in accordance with taxpayer rights as afforded by other provisions of this title.

(8) IRC 6201 - Assessment Authority, which falls under Chapter 63 - Assessment.

(9) Delegations of Authority are the official documents the IRS uses to delegate authority. They’re published as Delegation Orders. See IRM 1.2.2, Servicewide Policies and Authorities, Servicewide Delegations of Authority.

• Delegation Order 7-13 (Rev. 2) (formerly DO-248, Rev. 1), provides the authority to accept Classification Settlement Program (CSP) Offers and to execute the pro forma Closing Agreements on CSP Issues (see IRM 1.2.2.8.13, Delegation Order 7- 13 (Rev. 2).

• Delegation Order 8-3 (formerly DO-97, Rev. 34), provides the authority to enter into and approve a written agreement with any person relating to the Internal Revenue tax liability of such person (or of the person or estate for whom he or she acts) for a taxable period or periods ended before the date of agreement and related specific items affecting other taxable periods (see IRM 1.2.2.9..3, Delegation Order 8-6 (formerly DO-179, Rev.2), Coordination of Certain Issues Before Approval of Settlement or Other Disposition in Appeals).

(1) The Directors, EO/GE and EP, are the executives responsible for providing policy and guidance for field employees and ensuring consistent application of policy, procedures and tax law to effect tax administration while protecting taxpayers’ rights. See IRM 1.1.23, Tax Exempt and Government Entities Division, for additional information.

(2) The Directors, EO Examinations, GE, and EP Examinations reports to the Directors, EO/GE and EP respectively, and are responsible for the delivery of policy and guidance that impacts the field examination process. See IRM 1.1.23, Tax Exempt and Government Entities Division, for additional information.

(3) All examiners must perform their professional responsibilities in a way that supports the IRS Mission. This requires examiners to provide top quality service and to apply the law with integrity and fairness to all.

(4) Examiners and their managers should thoroughly acquaint themselves with the examination procedures and information contained in this IRM, as well as other resources.

(1) CP&C administers examination inventory control.

(2) The FAC coordinates the assignment of examination inventory.

(3) Two review groups make sure examiners conduct examinations per technical, procedural and administrative requirements:

1. Mandatory Review / Technical.

2. Special Review, see IRM 4.70.7, Special Review (SR) and Tax Exempt Quality Measurement System (TEQMS) Procedures.

(4) In order to ensure a consistent level of managerial engagement in the process of making key strategic decisions during an exam, the examiner submits requests for approval by their manager through RCCMS.

(5) The manager approves or rejects any request through RCCMS.

(6) The IRS is fully committed to protecting the privacy rights of taxpayers and employees. Privacy laws are included in the IRC, the Privacy Act of 1974, the Freedom of Information Act, and IRS policies and practices. For more information about these laws, visit the IRS Electronic Freedom of Information Act Reading Room.

1. For questions about privacy, email *Privacy.

2. For question about disclosure, email *Disclosure.

(1) The following tables lists acronyms, abbreviations, forms, and publications used in this manual along with their definitions:

(1) The following table provides definitions for the terms identified below:

(1) The Tax Exempt & Government Entities (TE/GE) Division serves charities and non- profits, small local community organizations, major universities, large pension funds, small business retirement plans, federal, state, and local governments, participants in complex tax-exempt bond transactions, and Indian tribal governments and their entities. The overall TE/GE examination program’s goal is to promote the highest degree of voluntary compliance with:

• The statutes governing qualification of plans and exemption of certain types of organizations.

• The federal return filing requirements of certain types of organizations within TE/GE’s jurisdiction.

• Reporting the "substantially correct" tax liability.

  Note: IRM 1.2.1.5.36, Policy Statement 4-119 (Rev. 1), Selection and Examination of Returns.

  Note: For purposes of this IRM, any reference to tax advantaged bonds includes tax exempt bonds, tax credit bonds, and direct pay bonds unless otherwise specified.

(1) Examiners should consult the Knowledge Management Virtual Library to ensure proper issue development and consistent application of the law.

(2) To ensure that the IRM is always current, future revisions of the IRM will refer you to one of the books below for the correct codes to use in lieu of specifying an activity code, disposal code, source or status code. The IRM will specify the section of the document to reference and the type of activity, disposition, source and status code to look up.

• Document 6379, Information Systems Codes FY 2023 Quick Reference for EO Employees

• Document 6476, Information Systems Codes FY 2023 Quick Reference for EP Agents/Specialists

• Document 11308, Information Systems Codes FY 2023 for GE Employees

  Note: You can also get the current version of the documents at our Business Systems Planning page.

(1) TE/GE Examinations process provides an organizational approach for conducting professional examinations from the first contact with the taxpayer through the final stages of issue resolution and case closure.

(2) TE/GE Examinations compliance program takes a strategic approach to effective tax administration.

(3) Not all examinations are the same in scope, size, and complexity; therefore, portions of this guidance may be more applicable to some cases than others.

(4) There are three phases to an examination:

1. Planning Phrase

2. Execution Phrase

3. Resolution Phrase

(5) The planning phase of the examination process determines the scope of the examination.

1. Issues selected for examination should have the broadest impact on compliance regardless of the size and type of entity or organization.

2. Once the examiner and group manager determine the issues for examination, they will work to establish effective steps to complete the examination in a timely manner.

3. Examiners and their managers will determine, on a case-by-case basis, whether the examination is conducted at the taxpayer’s place of business, the POA’s office, or worked through correspondence. The group manager must sign or notate the Form 5464, (CCR) or email the examiner concurrence with the location.

1. Issues selected for examination should have the broadest impact on compliance regardless of the size and type of entity or organization.

2. Once the examiner and group manager determine the issues for examination, they will work to establish effective steps to complete the examination in a timely manner.

3. Examiners and their managers will determine, on a case-by-case basis, whether the examination is conducted at the taxpayer’s place of business, the POA’s office, or worked through correspondence.

   Note: If the examination location is at a place other than the taxpayer’s place of business, the group manager must sign or notate the Form 5464 (CCR) or email the examiner concurrence with the location.

4. TE/GE processes and procedures for conducting an examination, along with an overview of taxpayer rights, will be explained to the taxpayer/POA at the opening conference and documented on the CCR.

5. The examiner must obtain managerial concurrence upon development, and/or subsequent modification of the exam plan.

(6) The execution phase of the examination involves reviewing records and developing issues.

1. Stages of issue development include determining the facts, applying the law to those facts and understanding the various tax or compliance implications of the issue.

2. The parties will conduct interactive discussions, using the Information Document Request (IDR) process to develop the facts.

3. Every effort should be made to resolve any factual differences.

4. A preliminary examination report of proposed issues of noncompliance will be provided throughout this phase to present the government’s legal position to the taxpayer. The taxpayer’s response to these proposals will allow the examiner to gain an understanding of the entity or organization’s position to facilitate issue resolution at the earliest appropriate point.

   Note: A preliminary examination report could include an IDR, Form 5701 series, Form 886-A, etc. This list is not all inclusive.

(7) The goal of the resolution phase is to reach agreement, if possible, on the tax or compliance treatment of each issue examined and if necessary, issue a Revenue Agent Report (RAR) or Closing Agreement to the taxpayer.

1. Starting with the development of the issue and continuing through resolution, early and frequent discussions are crucial for a complete understanding of the respective merits of an issue.

2. During this phase, examiners should consider Alternative Dispute Resolutions such as Fast Track Settlement, where appropriate.

(1) In accordance with Policy Statement 4-117, Examination Authority to Resolve Issues, examiners, and managers:

1. Have been given broad authority to consider and weigh conflicting information, data, and opinions.

2. Use professional judgment in accordance with examining standards to make findings of fact and apply the IRS’s position on issues of law to determine the correct tax liability.

3. Exercise this authority to obtain the greatest possible number of agreements to tax determinations without sacrificing the quality or integrity of those determinations, and to dispose of tax differences at the lowest level.

   Note: See IRM 1.2.1.5.34, Policy Statement 4-117, Examination Authority to Resolve Issues.

(2) The IRS employees must be familiar with and act according to the TBOR. Every employee must consider these rights in carrying out their duties. See IRC 7803(a)(3).

(3) The IRS employees working tax related matters must identify themselves (The Restructuring and Reform Act of 1998 (RRA 98) Section 3705(a)).

1. The IRS employees are required to give their name and unique identification number during taxpayer telephone, face-to-face, and written contact.

2. The IRS employees must put a telephone number on all taxpayer correspondence. This gives taxpayers enough information to identify an employee who has previously assisted with a tax related matter.

   Note: The IRS employees must provide this information to each individual they have contact with during an examination or other IRS work. See IRM 3.11.25.2.2, IRS Employee Contacts.

(4) During an examination, examiners are responsible for:

1. Analyzing returns assigned for examination.

2. Identifying all potential issues disclosed on the return.

3. Setting the proper scope for the examination.

4. Asking appropriate questions during the initial taxpayer contact.

5. Preparing a clear, concise, and appropriate initial Form 4564, Information Document Request.

6. If applicable and appropriate, requesting appropriate taxpayer documents to be received and reviewed in advance of the site visitation.

7. Developing appropriate interview and internal control questions prior to the initial appointment.

   Note: For Declaratory Judgment Cases and cases requiring an Administrative Record, the examiners are responsible for:

   • Knowing which cases are subject to declaratory judgement actions.

   • Determining if a case file would require an administrative record.

   • Determining how to maintain the administrative record.

   • Knowing what documents are included in an administrative record.

   • Properly preparing an index for an administrative record.

(5) SB/SE is the program owner for employment tax issues and penalties. FSL/ET maintains responsibility for handling employment tax issues and penalties for government entities. ITG maintains responsibility for handling employment tax issues and penalties for any federal tax issues involving federally recognized Indian tribes. The Bureau of Indian Affairs (BIA) maintains a list of federally recognized tribes and a Tribal Leader's Directory on their website at Tribal Leader's Directory.

(6) The correct and timely reporting of employment taxes are the key to our voluntary compliance system as well as the cornerstone of the Social Security System. Studies show that the issuance of Forms W-2 greatly increases the likelihood that the income will be reported. Employment taxes include:

• Income Tax Withholding

• Social Security and Medicare taxes under FICA

• Unemployment Tax

(7) Examiners are responsible for determining if penalties are applicable in cases such as, but not limited to:

• Form 941, Employer’s Quarterly Federal Tax Return, employment tax examinations.

• Form 945, Annual Return of Withheld Federal Income Tax, back-up withholding examinations.

• Information Return Examinations.

(8) IRC 6751 requires written supervisory approval for all penalties except penalties or additions to tax under IRC 6651, IRC 6654, IRC 6655, or IRC 6662(a)(9) or IRC 6662(a)(10); or penalties automatically calculated through electronic means.

(1) IDRS is the acronym for Integrated Data Retrieval System, a major application of databases and operating programs that support the IRS employees working active tax cases. This system allows the IRS employees to research taxpayer account issues, track status and post transaction updates to the Master Files (MF). IDRS updates are done in both a batch process and through online interactive real-time programs Command Codes.

(2) AIMS is the acronym for the Examination Information Management System, which provides inventory and activity controls of active examination cases. AIMS links to IDRS to input status changes, adjustments, and case closing actions. Compliance checks are not tracked on AIMS.

(3) WebETS is the acronym for the Web-based Employee Technical Time System. WebETS provides TE/GE employees a web-based application to:

1. Track cases.

2. Maintain inventory.

3. Report time as it is applied.

   Note: To access WebETS, visit https://webets.web.irs.gov/.

(1) The IRS employees are required to ensure that sensitive information is protected from unauthorized disclosure and access. This includes returns and return information but also includes other non-tax information, documents, records and processes.

(2) For information on protecting and safeguarding Sensitive But Unclassified (SBU), Personally Identifiable Information (PII) and Other Sensitive Information, refer to the Think Data Protection website, IRM 10.5.1, Privacy and Information Protection, Privacy Policy and IRM 10.5.8, Safeguarding Sensitive But Unclassified (SBU), Personally Identifiable Information (PII) and Other Sensitive Information.

(1) An official chronology should be included in every case file to record actions taken on the case, contacts made, follow-up dates and time expended. The form is a historical record. Update the chronology at the same time you take actions.

1. For EO/EP/TEB cases, use Form 5464 Case Chronology Record (CCR).

2. For FSL/ET/ITG cases, use Form 9984 Examining Officer’s Activity Record (EOAR), henceforth referred to as "CCR".

(2) The RCCMS embedded chronology:

1. Is optional to use.

2. Allows you to create new chronology records for each activity, review existing activity records, establish follow-up dates, and print the record.

3. Captures system activities, such as case establishment, transfers, status updates, and so forth.

4. Provides easy access for managers, reviewers, and other users with access to the RCCMS case file to document their activities involving the case.

5. Allows for Manager documentation of their review and approval of case closures with certain survey disposal codes and will include any applicable Special Handling instructions as required.

6. To add a manual chronology entry, click on the Chronology tab and select the new Chronology button. The Untitled – Chronology Box opens and allows you to input various entries. Complete the required red asterisked fields. Click "Save" and "Close" to save your entry.

(3) Include on the chronology, at a minimum, the following entries:

1. Date the examiner receives the case.

2. Date the case is updated to status 12.

3. Work you performed before, during, and after taxpayer/ representative contact.

4. Date the initial contact letter is mailed.

5. Appointments scheduled including the date, place, time, and contact.

6. Date and summary of contacts with taxpayers, representatives, and third parties, whether in person or by phone.

7. Date of receipt and processing of Form 2848, Power of Attorney and Declaration of Representative, Form 8821, Tax Information Authorization, or Form 56, Notice Concerning Fiduciary Relationship.

8. Date you toured the organization's site, if applicable.

9. Dates you sent or received correspondence to/from the taxpayer and/or representative and with follow-up date(s).

10. Date you issued and received Form 872, Consent to Extend the Time to Assess Tax or Form 872-H, Consent to Extend the Time to Assess Tax on a Trust (if applicable).

11. Dates you issued and followed up on subsequent IDRs.

12. Deadlines, response dates, and follow-up actions.

13. Any actions taken with respect to validating or protecting the statute of limitations.

14. Delays or lack of cooperation by the taxpayer and/or representative.

15. Explanations for delays of significant action on the case by the examiner.

16. Explanations of any delays in completing the examination resulting from both actions by the IRS (training, details, etc.), and/or the taxpayer/representative.

17. The date you issued the report and the date you received the signed report. Note the date that Pub 3498, The Examination Process, or Pub 5146, Employment Tax Returns Examination & Appeal Rights, was issued (if required) to close the case.

(4) Include in the chronology, at a minimum, the following entries for management involved:

1. Description of GM involvement, including concurrence of the exam plan, and informal discussions about case development and quality.

2. Dates of formal, in-process case reviews, on-the-job-visitations, and workload reviews. The GM should notate the chronology at the time of involvement.

   Note: As cases are electronic in RCCMS, email your chronology to your manager for comments, or note in the chronology places for the manager to record approval.

3. Date you closed the case to GM.

4. Date GM approved the case for closing.

(5) Since it is part of the examination trail, the chronology may be disclosed to the taxpayer under the Freedom of Information Act. Ensure entries are professional, accurate, and concise. Omit personal opinions. If an entry is lengthy (for example, a long phone call), place this information on a separate workpaper indexed to the chronology.

(6) A clear, concise chronology is particularly important in sensitive or high-profile cases, and when the case involves uncooperative taxpayers or representatives (or issuers in TEB cases),or will be the subject of litigation.

(7) It is critical to properly document all delays in cases, the chronology may be used in an interest abatement case. See IRC 6404(e) (providing for the abatement of interest when any assessment of interest on a deficiency is attributable in whole or in part to an unreasonable error or delay on the IRS’s part in performing a ministerial or managerial act).

(1) The following are related resources that provide additional guidance on procedures related to TE/GE Examinations:

1. IRM 1.25.1, Practice Before the IRS, Rules Governing Practice Before the IRS.

2. IRM 4.5, TE/GE AIMS Manual.

3. IRM 4.10.3, Examination of Returns, Examination Techniques.

4. IRM 4.23, Employment Taxes.

5. IRM 5.1.12.3, Taxpayer Recording of Interviews.

6. IRM 10.5, Privacy and Information Protection.

7. IRM 11.3, Disclosure of Official Information.

8. IRM 20.1, Penalty Handbook.

9. IRM 20.2, Interest.

10. IRM 21.3.7, Processing Third Party Authorizations onto the Centralized Authorization File (CAF).

11. IRM 25.1, Fraud Handbook.

12. IRM 25.5, Summons.

13. IRM 25.6.23, Statute of Limitations, Examination Process-Assessment Statute of Limitations Controls.

14. IRM 25.27.1, Third Party Contacts.

15. Information Systems Codebooks (Document 6379 (EO), Document 6476 (EP), and Document 113808 (GE)).

(2) Examination Knowledge base on the IRS Virtual Library.

(3) TEQMS on TE/GE Connect TEQMS, TE/GE TEQMS User Guide is available on the TEQMS website.

(4) TEB: If the issuer or conduit borrower is an Indian tribal government, notify the Indian Tribal Governments function within the Government Entities division of TE/GE:EO/GE before you contact the tribal government to ensure compliance with all government-to-government relationship protocols.

(5) TEB: If the issuer is a territory or possession of the United States of America or the case otherwise impacts international tax administration:

1. Follow the International Operating Procedures for TE/GE Employees. See IRM 4.46.4, LB&I Examination Process, Executing the Examination and IRM 4.60.1, International Procedures, Exchange of Information.

2. Inform the TEB Technical manager of the issuer subject to the examination.

(6) TEB: If the borrower is a church, notify the FAC for Exempt Organizations’ Examinations before you make contact to ensure compliance with protocols involving churches.

(1) The IRS is governed by consultation policies that may be adopted by the Department of the Treasury. Indian Tribal Governments (ITG) continues this dialogue to ensure we constantly evolve to reflect tribal, the IRS, and stakeholder needs.

(2) The Treasury Department has a consultation process to dialogue with Indian tribes on a government-to-government basis. This allows better understanding and response to their needs on Treasury regulations, legislative comments, proposed legislation, and policy statements that have Tribal implications, impacts Tribal economy, or preempt Tribal law. The Office of Economic Policy and led by the Assistant Secretary for Economic Policy is responsible for coordinating consultation between the Indian tribes and Treasury Department bureaus and offices. Please use the e-mail below to contact the Treasury’s official point of contact for tribal consultation if you have any questions, concerns or comments.

(3) A government-to-government relationship is a bilateral recognition of the respective parties’ sovereignty. The IRS must interact in a way that respects the tribe’s position as a sovereign entity. Follow these guidelines when working with tribal governments:

• Understand each tribe’s unique political structure, including the appropriate titles for addressing tribal leaders.

• Be mindful of tribal preferences in all communication.

• Be sensitive to cultural diversity.

• Ensure that appropriate tribal officials are present at initial and necessary follow-up meetings.

• Negotiate and understand agreed-upon procedures for conducting inter- actions with tribal governments.

(4) ITG specialists trained in tribal protocols are the primary IRS point of contact for all interactions with federally recognized Indian tribes and are responsible for:

1. Most IRS compliance activities with tribes.

2. Ensuring the IRS complies with relevant Presidential Executive Orders that outline the required relationships and protocols in working with tribes.

(5) ITG specialists are specially trained in the unique areas of tax law and protocols applicable to Indian tribes.

(6) To alleviate potential problems and ensure that the IRS complies with existing legal requirements, all IRS employees must contact Indian Tribal Governments before initially contacting any Indian tribal government/enterprise account(s). Sometimes, a tribe may request that all IRS employees get the tribe’s approval before entering tribal lands when conducting IRS business.

(1) When the IRS issues a Declaration Notice under IRM 25.16.1.5.3, Internal and External Notification Process, a freeze code is placed on all IMF and BMF accounts with addresses in the area affected by the federally declared disaster (the "covered disaster area") designated by FEMA as qualifying for "individual assistance" for the period specified in the Declaration Notice (the "postponement period").

(2) An affected taxpayer under IRM 25.16.1.3, Identification of Covered Disaster Area, Postponement Period, and Affected Taxpayers, may contact the IRS to self-identify as eligible for relief under a Declaration Notice.

1. For these cases, contact the FAST Unit (*TEGE FAST) to have the – S freeze code, under IRM 25.16.1.1.1, or the – O freeze code, under IRM 25.16.1.7.2, entered on the taxpayer’s account.

(3) Use Letter 6017, Taxpayer Contact after Disaster - TE/GE, from the IRS, for cases in status 12, when communicating with affected taxpayers. Be considerate and sensitive to personal circumstances such as stress and fatigue even if the taxpayer didn’t experience any personal, monetary, or physical damage from the declared disaster.

(4) Include Notice 1155, Disaster Relief from the IRS, in any subsequent correspondence (such as IDRs cancelling an appointment, postponing an IDR deadline, or requesting additional information when the taxpayer opts out of the postponement period) that you send to the taxpayer/POA during the postponement period.

(5) Cases not subject to suspension of examination activities:

• Cases involving jeopardy assessments

• Cases in AIMS status 18, Acceptance by Criminal Investigation

• Grand Jury Cases

• Cases other than those listed here but where the functional Director has determined an exigency exists

  Note: An exigent circumstance is one involving the government’s loss of opportunity to collect taxes due, such as the expiration of the statute of limitations, assets being placed beyond the reach of the government, etc. An indication that the taxpayer may file for bankruptcy is generally not an exigent circumstance. Managers and employees must consider all relevant factors including the amount of the liability, the time remaining on a statute of limitations, the taxpayer’s individual circumstances and other relevant matters to determine that an exigent circumstance exists. If an exigent circumstance exists regarding an affected taxpayer during the postponement period, compliance activity may be pursued with documented managerial approval. If approval is granted, the -O freeze code will be replaced with a -S freeze code and the appropriate enforcement action taken.

(6) If you have been assigned a case and you have not contacted the taxpayer, do not make contact. Place the case in status 38 suspense, cease all activity until the first business day after the close of the postponement period and document the CCR.

1. Place the case in status 38 suspense.

2. Cease all activity until the first business day after the close of the postponement period and document the CCR.

(7) Cases in development:

1. If you already sent an initial contact letter, send Letter 6017 to notify the taxpayer that you’re suspending the examination and postponing any scheduled appointment(s) until after the end of the postponement period. You don’t have to return documents you received from the taxpayer. Provide the taxpayer the option to continue with the examination. If the taxpayer chooses to continue with the examination, document your conversation or the taxpayer’s correspondence in the CCR and email the FAST Unit (*TEGE FAST) and ask them to replace the –O freeze code with a –S freeze code.

2. If you have all the necessary information to work the case and you don’t need to contact the taxpayer, continue working the case (in status 12). If the result is favorable to the taxpayer, close the case under normal processing procedures.

   Note: For cases that can’t be closed with a –O Freeze code in effect, contact the FAST Unit (*TEGE FAST) to remove the –O freeze code, so the case can be closed. The FAST Unit will put the –O freeze code back on the module after the case is closed. If you have an appointment scheduled, cancel it, subject to (iv) and (v) below.

3. If you have an appointment scheduled, cancel it, subject to (d) and (e) below.

4. If you have an IDR outstanding, postpone the due date to the end of the postponement period, subject to (e) below.

5. If you don’t have all the necessary information to work the case and you previously spoke with the taxpayer, call the taxpayer/POA to inform them that we’ll postpone the examination unless they choose to continue with the examination. Discuss the contents of Letter 6017 and document your CCR to fully explain your conversation and whether the taxpayer wants relief or chooses to bypass the postponement period and continue the examination.

6. If you don’t have all the necessary information and you can’t reach the taxpayer by phone, or you never spoke with the taxpayer, send the taxpayer/POA Letter 6017.

7. If the taxpayer opts out of the postponement period after receiving Letter 6017, document in the CCR the taxpayer’s oral or written request to bypass the postponement period and continue the examination.

8. If you can’t continue to work on the case due to the Declaration Notice, place the case in status 38 suspense, cease all activity until the first business day after the close of the postponement period and document the CCR.

   Note: During the postponement period you may do electronic research (for example, Westlaw, IDRS, Accurint) and prepare an action plan for the necessary case actions you’ll take when you resume examination activities, but you can’t require the taxpayer to provide documentation or to take action unless the statute of limitations will expire during the postponement period and only if you get the area manager’s approval.

9. If you issued a summons before the postponement period and the period for the taxpayer to quash expired before the beginning of the postponement period, you may proceed with summons enforcement if the bank or third party record-keeper doesn’t reply. Consult Division Counsel about enforcement of the summons. No other summons may be issued or enforced during the postponement period.

(8) Cases in 30-day processing (preliminary notice of deficiency, revocation or non-qualification) offering opportunity to appeal:

• If a 30-day letter was issued prior to the postponement period, notify the taxpayer by telephone or mail (enclose Notice 1155) that a response to the 30-day letter will be timely if received at the end of the postponement period.

• If a taxpayer provided a valid protest to Appeals before the postponement period, contact the taxpayer to confirm that the taxpayer is still prepared to continue with Appeals. If yes, update the Case Chronology and contact the FAST Unit to change the -O freeze code to a -S freeze code. Forward the case to the Closing Unit.

(9) If Mandatory Review issued a 90-day letter before the postponement period, and the 90-day period will end within the postponement period:

• The 90-day letter is not retracted and the period in which to respond is not suspended. The 90-day period established by the 90-day letter starts and ends as described in the letter (as if no disaster).

• Due to the federally declared disaster, the Taxpayer can, but is not required to respond to the 90-day letter any time during the postponement period. However, the Taxpayer must act on or before the last day of the postponement period for the response to be timely.

• If the Taxpayer reaches out to TE/GE during the postponement period, TE/GE can respond; however, it may be prudent to consult with Division Counsel, especially if TE/GE’s response could be construed as adverse to the Taxpayer. See IRM 4.2.2.11.4, Technical Services – Correspondence Received During Postponement Period.

• If the Taxpayer protests the 90-day letter (that is, the Taxpayer files a petition to Tax Court, during the postponement period) TE/GE should promptly take all actions necessary to transfer the case to Division Counsel. See IRM 4.8.9.25.4, Processing Petitioned Cases.

• If the Taxpayer does not respond, in any matter, to the 90-day letter before the end of the last day of the postponement period, TE/GE can resume case activities on the first business day after the end of the postponement period. See IRM 4.2.2.11.2.3, Technical Services – Statutory Notices of Deficiency Defaulted During Postponement Period.

(10) If Mandatory Review issued a 90-day letter before the postponement period, and the 90-day period ended before the postponement period, the defaulted notice of deficiency can be assessed. However, you must contact the FAST Unit to re-input the disaster-related freezes with the original suspension start and end dates to delay collection actions.

(1) You must suspend the following activities during the postponement period:

1. Contacting the taxpayer to schedule initial appointments when the taxpayer has been granted a suspension of examination activities and IDRS shows a –O freeze code.

2. Making assessments except when the taxpayer agreed to the assessment before, or after, the start of the postponement period.

3. Inspecting books and records and conducting examination-related activities with the taxpayer unless the taxpayer gives you permission to continue with the examination.

   Note: You may continue work that doesn’t require taxpayer contact, such as reviewing records obtained before the postponement period or doing electronic research, tax law or other necessary research.

4. Issuing any summons to the taxpayer or third-party record-keeper.

5. Requiring the taxpayer to comply with a previously issued summons, except if the activity falls under IRM 4.70.11.3.1, Case Suspense for Federally Declared Disaster, or Terrorist or Military Action.

6. Initiating third-party contacts.

7. Issuing an examination report, except when the taxpayer agreed to the assessment before, or after the start of the postponement period.

8. Entering into a Fast-track settlement.

9. Issuing a 30-day letter (preliminary notice of deficiency, revocation or non-qualification offering opportunity to appeal).

(1) Secure approval from your Area or Program Managers to solicit a consent to extend the statute. If you solicit a statute extension, follow the procedures in IRM 4.70.12.3.7, Statute of Limitations and Statute Control Procedures.

(2) If your Area or Program Managers approves a statute extension during the postponement period, document the CCR accordingly.

(3) If you can’t contact the taxpayer or the taxpayer refuses to extend the statute of limitations, close the case to Mandatory Review or the Closing Unit following the procedures in IRM 4.70.14.3.4, Unagreed Resolution.

(1) Federally authorized practitioners are individuals authorized to practice under 31 U.S.C. 330. Generally, this means attorneys, CPAs, enrolled examiners, enrolled actuaries and enrolled retirement plan examiners as set forth in Circular 230.

(2) Refer to TEGEDC questions as to whether the taxpayer confidentiality privilege applies to communications made to other individuals.

(1) The term “tax advice” means advice given by an individual with respect to a matter which is within the scope of the individual’s authority to practice before the IRS per IRC 7525(a)(3). Information disclosed for the purpose of preparing a tax return would not be privileged. This provision was not intended to provide tax practitioners a greater privilege than currently exists between attorneys and their clients.

(2) The American Jobs Creation Act of 2004 amended IRC 7525(b) by stating that the federally authorized tax practitioner privilege doesn’t apply to any written communication in connection with the promotion of the direct or indirect participation of the person in any tax shelter between a federally authorized tax practitioner and any person, director, officer, employee, agent, or representative of the person.

(3) In general, communications from a taxpayer to an attorney made in confidence while obtaining legal advice are privileged. The attorney can’t be compelled to disclose that information to the IRS. The privilege is a provision of common law upheld by the courts.

(4) If the taxpayer creates records to facilitate the exchange of privileged communications with a federally authorized tax practitioner, those records are privileged.

(5) If a taxpayer turns over pre-existing records to a federally authorized tax practitioner, the IRS can obtain those records by summons, unless the records were otherwise privileged from production while in the taxpayer’s possession.

(6) A federally authorized tax practitioner’s client in an examination may be any officer or employee of the taxpayer. You can obtain underlying factual information from the employees whether they’ve communicated this same information to the taxpayer’s federally authorized tax practitioner.

(7) The taxpayer confidentiality privilege is not all-inclusive and does not protect everything a federally authorized tax practitioner may do for a client. The privilege is limited to communications the client made in confidence to obtain legal advice from an attorney, or to obtain tax advice from a non-attorney federally authorized tax practitioner.

(8) The following items are also not covered by the taxpayer confidentiality privilege:

• Ministerial or clerical services

• Records of financial transactions involving monies paid by or on behalf of a client to a federally authorized tax practitioner

• Records of transactions where the federally authorized tax practitioner acts as the client’s business advisor, or examiner for the receipt or disbursement of money or property to or from third parties

• The identity of a client or the fact that a given individual has become a client, absent special circumstances

(9) The preparation of a tax return is primarily an accounting service. The taxpayer confidentiality privilege does not cover:

• Work papers produced while preparing the returns or the tax records used.

• Communications between the client and the federally authorized tax practitioner about the return being prepared.

(1) An officer, director, trustee, or representative may attempt to hinder or halt an examination by various methods, including:

1. Invoking the Fifth Amendment privilege against self-incrimination

2. Asserting a taxpayer confidentiality privilege

3. Claiming documents are covered by the work product doctrine

4. Asserting a federal tax practitioner-client privilege under IRC 7525

(2) The person can assert these privileges orally or in writing.

(3) A person can’t successfully refuse to testify or provide information solely based on the facts that he/she stands in a confidential relationship with another person. The burden is on the witness to:

1. Establish the facts on which the asserted privilege is based.

2. Demonstrate how, and the extent to which, the requested information is covered by the privilege.

(4) The federal tax practitioner-client privilege may only be asserted in:

1. Any noncriminal tax matter before the IRS (IRC 7525(a)(2)(A)).

2. Any noncriminal tax proceeding in federal court brought by or against the United States. (IRC 7525(a)(2)(B)).

   Note: A case will cease to be a noncriminal tax matter before the IRS only after it is referred to Criminal Investigation for the assignment of the special examiner. Once the matter becomes a criminal matter, the taxpayer may no longer assert the IRC 7525 privilege.

(5) The federal tax practitioner-client privilege may not be asserted to prevent disclosing of information to any regulatory body (i.e., the Securities and Exchange Commission) other than the IRS, including in an administrative or court proceeding.

(6) When a taxpayer or federally authorized tax practitioner declines to provide testimony or documents citing IRC 7525 confidentiality privileges as the reason:

1. Request that the taxpayer or federally authorized practitioner provide a written statement regarding the reason that the IRC 7525 confidentiality privilege is being asserted.

2. Consult with TEGEDC for guidance.

(7) See IRM 4.10.1.2, Taxpayer Rights, and IRM 5.17.6, Legal Reference Guide for Revenue Officers, for additional information, including court case citations and additional analyses.

(1) Employees working tax related inquiries must provide taxpayers with information to identify the appropriate employee who can address any further questions (Section 3705 the Restructuring and Reform Act of 1998 (RRA ‘98)).

(2) For face-to-face and telephone contacts, all the IRS employees will provide the following information:

• Name (first and last)

• Unique identification number (Smart ID badge number)

• Group manager’s name and phone number during the initial conversation

• Purpose of your call

  Caution: When disclosing the purpose of your call, remember that only authorized individuals are entitled to receive notice of an examination.

(3) For all manually generated correspondence sent to a taxpayer, all IRS employees will provide the following information:

• Name (first and last)

• Unique identification number (Smart ID badge number)

• Telephone number

• Group manager’s name and phone number on initial correspondence

(4) Employees must repeat their name and unique identification number (Smart ID card badge number) to each new and subsequent contact made during the work assignment.

(5) Examiners should document their CCR with the person’s name, title and date when you gave them your contact information.

(6) If a case is reassigned to another examiner, the new examiner must also give their name and unique identification number (Smart ID badge number) to the taxpayer.

(1) Examiners should ensure verbal communication is firm, courteous, and professional by:

1. Using effective communication skills (i.e., listening, responding and clarifying), to secure the taxpayer/representative’s cooperation.

2. Using tact to explain findings and conclusions to ensure tax law and accounting principles and practices are clearly communicated.

3. Ensuring the communication methods used are appropriate to the taxpayer.

4. Always considering the taxpayers/representative’s point of view.

(2) Answering machines and voice mail are frequently used when communicating with taxpayers, representatives, and other IRS employees. These systems are not secure and may not be used to transmit sensitive information, including tax information, except under the provisions of IRC 6103. Guidelines for leaving information on answering machines/voice mail are located in IRM 10.5.1.6.7.2, Answering Machines or Voice Mail.

(1) Written communication to the taxpayer or representative must:

• Be complete, clear, and professional without jargon or IRS acronyms.

• Communicate the message in a concise and professional tone using correct grammar, spelling, and punctuation.

(2) All correspondence must contain the name of the person to contact (examiner or group manager depending on the type of letter), telephone number, unique identification number, and a signature.

(3) When possible, all correspondence with taxpayers should be prepared using approved form letters, since the specific language in these documents has been approved for general public use.

(4) All correspondence generated by examiners is considered manually generated correspondence.

1. Examiners must provide the taxpayer with their group manager’s name and phone number during the initial conversation.

2. Examiners should document on the CCR or case activity record when their name and unique identification number was provided.

(5) If mail is returned as undeliverable after the case is closed, follow the procedures in IRM 4.70.11.8.3.1, Returned or Undeliverable Mail.

(1) IRC 6103 provides details on the confidentiality and disclosure rules that must be followed when working with taxpayer return or taxpayer return information. Examiners must remember to protect tax information when using the fax machine or EEFax, which provides the ability to send, receive, route and deliver fax documents electronically using Microsoft Outlook.

(2) See IRM 4.10.1.3.6, Use of Fax Machine or Enterprise e-Fax (EEFax) for Outgoing Taxpayer Communications. See IRM 4.10.1.3.7, Policy for Use of Fax in Taxpayer Submissions.

1. In addition to the list in IRM 4.10.1.3.7(3), requests for public inspection or copy of Exempt or Political Organization IRS Form 4506-A will continue to be accepted by fax in routine operations.

2. In addition to items listed in IRM 4.10.1.3.7(4), the following items can be accepted by fax if contact has been made with the taxpayer and the case file is updated as required:

Early Referral Requests Fast Track Mediation Requests Consents to assess additional tax (Form 4549, Form 4549-E, Form 870, and others)

3. Employee Plan and Exempt Organization determination letter applications will not be accepted via fax.

(3) Examiners may send and receive emails from the taxpayers or POA; however, the procedures found in IRM 10.5.1.6.8, Email, and IRM 10.5.1.6.9, Other Forms of Transmission, must be followed.

(1) This section contains guidance regarding the appropriate use of electronic signatures on letters, forms and other documents.

(2) To sign documents electronically, the following procedures must be followed to comply with the Government Paperwork Elimination Act (GPEA):

1. The signer must use an acceptable electronic form of signature;

2. The electronic form of signature must be executed or adopted by a person with the intent to sign the electronic record (e.g., to indicate a person’s approval of the information contained in the electronic record);

3. There must be a means to identify and authenticate a particular person as the signer; and

4. There must be a means to preserve the integrity of the signed record.

(3) Examiners and managers should use Adobe to create digital signatures that meet the requirements of GPEA. Adobe can create a digital signature that displays the signer’s Standard Employee Identifier (SEID), typewritten name, or an image of the signer’s handwritten signature. For assistance in creating digital signatures, including a graphical image of a handwritten signature, refer to the IT4U Self Help Website, and type in Adobe in the Search field, then select the appropriate option based on the Adobe version.

(4) Internal use documents can be signed electronically by using a digital signature that displays the signer’s SEID or typewritten name.

(5) Generally, letters, forms and other documents issued to the taxpayer and representative can be signed digitally. However, the digital signature should display an image of the signer’s handwritten signature in the signature block. Under no circumstances should a letter or document provided to the taxpayer reflect the SEID as the signature.

(6) For additional details refer to IRM 10.10.1.3, IRS Electronic Signature (eSignature) Program.

(7) The taxpayer's and representative’s dated signatures are required. An electronically signed, printed or stamped signature is not acceptable. A hand printed (not typed) signature is acceptable.

(8) See IRM 21.3.7.5.1, Essential Elements of Form 2848 and Form 8821 and IRM 21.3.7.1.4, Taxpayer Digital Communication (TDC) CAF Overview for more information.

(1) The office of ITG will provide assistance throughout Indian country as needed.

1. Taxpayers may request assistance after receiving a letter, notice or other contact between the IRS and a tribal entity. For example, penalties, filing requirements, deposit due dates, and information return reporting, correcting a reporting problem or error.

2. With managerial approval, a specialist may proactively offer assistance to a tribal entity when the need is identified.

3. Outreach contacts may identify additional opportunities for ITG customer assistance.

(2) The objective of this individualized assistance is to increase voluntary compliance by helping our customers to understand, implement and fulfill their responsibilities. Help may be by phone, correspondence, email, fax, or face-to-face.

(3) If the customer is having difficulty resolving a tax situation, consider whether the situation meets Taxpayer Advocate criteria. See IRM 13.1.7, Taxpayer Advocate Case Procedures and Pub 1546, Taxpayer Advocate Service - We Are Here to Help You.

(4) Customers can also get educational materials and answers to questions about federal tax matters by contacting the office of Indian Tribal Governments in the following manner:
Visit: ITG website at www.irs.gov/tribes
Call: Customer Account Services:
Toll-free 877-829-5500
Not Toll-free 202-317-8900
Fax: Toll-free 855-243-4024

Write:

Internal Revenue Service
Indian Tribal Governments
SE:T:EOGE:GE:ITG
1111 Constitution Avenue NW
NCA-6th Floor
Washington, DC 20224-0002

(1) Before you issue an initial IDR, you should:

1. Conduct initial research applicable to the taxpayer.

2. Identify potential issues in order to identify the information that you need.

3. Consider alternate sources for the information.

(2) Identify alternate means to obtain the needed records.

1. As a best practice, mail your initial Information Document Request (IDR) with the Letter 6031 Initial Exam Appointment or Letter 3850 Employment Tax Appointment.

2. Consult your manager if you find it may not be appropriate to send the initial IDR with Letter 6031 or Letter 3850 for a specific examination.

3. Document the consultation in your CCR.

(3) Preparing the initial IDR:

1. As a best practice, use Form 4564 to generate your initial IDR(s).

   Note: For EP, Use IDRs available in the RCCMS Forms, Letters, Templates repository to request items needed for the examination. Send your initial request with Letter 6031.

2. Request documents, files and information that are pertinent to the purpose of the examination based on the examination plan, periods under examination, and other taxpayer specific factors considered during exam planning.

3. Explain in the IDR why items are being requested. This helps to increase customer satisfaction with the examination process.

4. Be specific, clear and concise.

5. Group the information being requested by issue, explaining why the items are being requested. As a best practice, prepare a separate IDR for each issue. Separate IDRs for each issue improve customer service when taxpayers have different departments or individuals handling different issues.

6. Number or letter the items requested.

7. Do not request documents that are already in the IRS possession.

8. Consider requesting a representative sample of documentation when you reasonably believe a response could be more voluminous than required to assess an issue.

9. Include a response date (specific date or time frame), form of response (electronic formats accepted; paper copies) and the method the taxpayer should use to submit data (by mail; made available at the initial appointment).

   Note: The response date for the initial IDR should be 30 days from mailing. Some items may need to be received ahead of the initial appointment (ONLY if you plan to review them prior to the appointment.) It is important to group those items together in the initial IDR and specify the time period (10 business days before the initial appointment), form and method to respond.

10. State that additional records will likely be requested as the examination progresses.

11. Indicate the you will review documents for completeness within 10 business days of receipt of the documents.

12. Ten business days after mailing the initial contact letter, call the taxpayer if the taxpayers has not contacted the examiner prior to that date. See IRM 4.70.12.7.2, Follow-Up to Initial Contact Letter.

13. During the initial call with the taxpayer (or POA, if known):

• Discuss the issues being examined and the items being requested on the IDR. If, after the discussions, you believe that clarification to the IDR is needed, modify the request and reissue it to the taxpayer.

• Agree on an updated response date – which may also be an appointment date.

• An updated response date from this initial call is not treated as the first extension but as a modification of the IDR.

(1) After securing the information from the initial IDR, it may be necessary to secure additional information. A subsequent IDR should be prepared.

(2) Prior to issuing a subsequent IDR, you and the taxpayer should agree on a response due date.

1. Ideally, the response dates should be within 10 business days.

2. If the taxpayer responds that they will not provide the information, proceed to the enforcement process. See IRM 4.70.13.9.4.2(4), EO Function Specific Considerations.

(3) You may mail, EEFax or hand deliver an IDR that is issued after the initial appointment letter.

(4) As a best practice, call the taxpayer (or POA if there is one) two to three business days prior to the IDR response due date.

(1) When the taxpayer responds to your IDR, review the response within 10 business days of receipt.

(2) If the taxpayer’s response is complete:

1. Call the taxpayer to advise that the response was complete.

2. Notate this action in the CCR.

(3) If the taxpayer’s response is incomplete or they fail to respond:

1. Call the taxpayer, within 5 business days to discuss the missing or incomplete items with the taxpayer to determine if an extension is warranted.

2. If an extension is warranted, you may grant a first extension.

3. You may grant up to 15 business days for the taxpayer to provide the incomplete or missing information.

4. You must send an extension approval letter, Letter 5798.

(4) If the taxpayer fails to respond to the first extension in IRM 4.70.13.9.3(3), Manager Approval, or if the response is still incomplete you may:

1. Determine, within five business days, whether to grant a second extension.

   Note: Second extension must be approved by your GM’s.

2. Discuss the missing or incomplete items with your GM to determine if you’ll grant a second extension.

3. With managerial approval, you may grant up to 15 business days for the taxpayer to provide the incomplete or missing information.

4. Send a second extension approval letter, Letter 5798, TE/GE Information Document Request Extension Notice, to the taxpayer.

(5) Make every effort to review IDR responses within 10 business days of receipt of documents.

(6) Notify the taxpayer of your review.

(7) If the requested information is not received after a second extension, begin the Enforcement Process.

(1) IDRs must comply with the general IDR procedures before the IRS can issue a summons. The process for enforcing delinquent IDRs from delinquency to summons issuance has three graduated steps:

1. Delinquency Notice

2. Pre-summons Letter

3. Summons

(2) This process is mandatory and has limited exceptions. It requires managers at all levels to be actively involved early in the process. This ensures that Counsel is prepared to support IDRs through the issuance of a summons when necessary.

(1) The following may be designated in a TIA:

1. An individual

2. A trust

3. A corporation

4. A association

5. A partnership

6. A federal, state, local, and foreign government agency, or a sub-units of such agency

(2) The persons who may be designated as a representative under a POA, as listed and fully described on Form 2848, include:

1. Attorneys

2. Certified public accountants

3. Bond Issuers

4. Conduit Borrowers

5. Enrolled actuaries.

6. Enrolled agents

7. Enrolled retirement plans agents

8. Family members (for individual income taxes only)

9. Full-time employees

10. Officers

11. Qualifying Students

12. Unenrolled return preparers

    Note: The acts an unenrolled return preparer can perform are limited as discussed in Footnote 1 of the table in IRM 4.70.11.10(4), Power of Attorney (POA) and Tax Information Authorization (TIA)). The acts the registered tax return preparer can perform is also limited.

(3) In Part II, Declaration of Representative of Form 2848, the representative(s) must list the following information in the Designation column:

(4) Only individuals who are recognized to practice before the IRS and aren't under suspension or disbarment from practice can be designated as a recognized representative. Corporations, associations, partnerships, and other persons who aren't individuals can’t be appointed as a recognized representative.

(5) Check to see if the representative has a current, active license using these resources:

1. Check a Certified Public Accountant's (CPA) license at https://www.aicpa.org/ "State Information" section or by calling appropriate state CPA board.

2. Check an attorney's license by contacting the appropriate state bar association. This information may also be available on the state bar association's website or try the American Bar Association's (ABA). The ABA doesn't operate a lawyer referral service but provides links to the state resources.

3. Check the representative’s status, by searching the CAF using command code CFINK.

1. CFINK is input using the full CAF number (CFINK 9999-99999R).

2. The table below reflects the possible CAF STATUS results. If the status is anything other than “GOOD”, the individual is not authorized to represent the taxpayer:

GOOD

DISBARRED

SUSPENDED

DECEASED

RETIRED

INELIGIBLE

4. If there is no enrolled agent indicator on the CAF, you may email requests for enrolled agent status verification directly to the Enrolled Practitioner Program mailbox: epp@irs.gox. Include the following information:

• First and last name

• Complete address (if available)

• Enrolled agent number (if available)

Note: To reduce the likelihood of a verification error, provide as much information as is available.

5. To determine if a practitioner has been sanctioned by the Office of Professional Responsibility’s (OPR), visit the OPR website https://www.irs.gov/tax-professionals/search-for-disciplined-tax-professionals.

   Note: If the search shows that the representative has lost his or her license (or had it suspended, revoked, or classified as inactive), send the POA form to the Area Return Preparer Coordinator.

6. Check the current roster of Enrolled Actuaries by following the link below Roster of Active Enrolled Actuaries.

(6) If the officers or authorized officials of the entity designate a company employee to represent the taxpayer during the examination, obtain Form 2848 for that employee.

1. If the entity chooses a specific employee (irrespective of title) to advocate, negotiate, or dispute issues with the IRS on behalf of entity, obtain a Form 2848 from the taxpayer authorizing that representation.

2. The Form 2848 must be signed by a duly elected officer or director of the entity (or other official with authority to bind the entity as determined by state law) as identified in the articles of incorporation or by-laws (typically, the same officer who signs tax returns and consents to extend the time for assessment of tax). The designation in Part II of Form 2848 will be "e", Full-Time Employee—a full-time employee of the taxpayer.

3. For a partnership with a tax year ending prior to January 1, 2018, all partners must sign and enter their exact titles. If one partner is authorized to act in the name of the partnership, only that partner is required to sign and enter his/her title. A partner is authorized to act for the partnership if, under state law, the partner has authority to bind the partnership. A copy of such authorization must be attached. For purposes of executing Form 2848 in the case of a TEFRA partnership examination, the TMP has authority to act for the partnership and may sign the Form 2848. For tax years beginning after December 31, 2017, the partnership is required to designate a partnership representative. However, such designation is not necessary if the partnership is an eligible partnership that has elected out of the centralized partnership examination regime. The partnership representative, as defined in section 6223(a), has the sole authority to act on behalf of the partnership under the centralized partnership examination regime. See IRM 4.31.9, Centralized Partnership Audit Regime (BBA) Field Examination Procedures.

   Note: The Bipartisan Budget Act of 2015 repealed the TEFRA partnership examination and litigation procedures and the rules applicable to electing large partnerships. The Act replaced these rules with a new centralized partnership examination regime. The Act also eliminated the role of "tax matters partner" and replaced it with "partnership representative" effective for tax years beginning after December 31, 2017.

   Note: Representation under Circular 230 means, advocate, negotiate, or dispute issue. Form 2848 is not required if the role of the designated individual is limited to providing or receiving information or to offer general explanations.

(7) Any person allowed to perform "limited practice" per section 10.7(c)(1) of Product Catalog Information (irs.gov) Circular 230 must be designated on a Form 2848.

(8) If a representative, appointed by the taxpayer, is not qualified to sign Part II of Form 2848, return the form to the taxpayer. You must not treat an invalid Form 2848 as authority for the individual to receive tax information.

(9) For TEB: Issuers and conduit borrowers use Form 2848, Power of Attorney and Declaration of Representative, to authorize an attorney or other qualified person to represent them before the IRS. See IRM 1.25.1, Rules Governing Practice Before the IRS. You may need to solicit a Form 8821, Tax Information Authorization, from the issuer or conduit borrower. This form authorizes the designated individual to receive or inspect tax return information but will not authorize the designee to represent the issuer or conduit borrower before the IRS. Situations requiring a Form 8821 include but are not limited to:

• When the representative appointed is not designated in paragraphs (a) through (r) of Part II of Form 2848.

• When direct communication between the examiner and the conduit borrower with respect to the issuer's tax matters may expedite the exam, the Form 8821 should be signed by the issuer.

• When direct communication between the examiner and the issuer with respect to the conduit borrower's tax matters may expedite the examination, the Form 8821 should be signed by the conduit borrower.

• When direct communication with other parties to the transaction that are not designated to represent the issuer under a Form 2848 is necessary (for example, communication with bond counsel, financial advisors, trustee, rebate consultants, underwriters, bidding agents, or investment providers), the Form 8821 should be signed by the issuer under examination.

(10) A valid Form 2848 or Form 8821 should contain the following information:

• Issuer/conduit borrower name, EIN, and business address.

• Name, address, and phone number of the representative/appointee.

• Type of tax (legal name of the bond issue, including issue amount) and tax form number (Form 8038 series).

• Year or period (date of issue).

• Signature, with date, of an appropriate official of the entity designating the authority.

• On Form 2848, the representative must sign and date the declaration (Part II) and enter the designation under which practice before the IRS is authorized.

(1) The Centralized Authorization File (CAF) function doesn’t process Forms 2848 submitted using a version older than the October 2011. So, if a POA submits an obsolete form, ask them to resubmit using the most current revision.

(2) Review the form for completeness and validity. For a list of required elements, see IRM 21.3.7.5.1, Essential Elements for Form 2848 and Form 8821. Elements specific to TE/GE Taxpayers are tabled by function in Exhibit 4.70.11-1, TE/GE Form 2848 and Form 8821 Specific Elements by Function.

(3) Taxpayers and representatives may not use signature stamps when signing POA/TIA forms. Original signatures are required.

(4) IRS accepts a faxed POA/TIA form and generally recognizes it. If there is some indication of forgery, the representative can be required to produce the original form.

(5) If the taxpayer wants the representative or designee to receive correspondence from the IRS, he/she must check the box in Part I, Item 2 of Form 2848 (below the representative's name and address) or Item 2 of Form 8821. Only two representatives will receive correspondence.

(6) The IRS will accept a non-IRS form. See IRM 21.3.7.5.1(5), Power of Attorney and Form 2848, for a list of the required information.

(7) A signed and dated statement made by the representative should also be attached to the non-IRS form. The statement must contain the same declarations contained in Part II of Form 2848.

(8) "Pen and ink" changes to Form 2848 or Form 8821 are not acceptable. If you discover imperfections, you must request that the taxpayer submit a new form.

(9) Verify that the individual shown as the representative is in good standing to practice before the IRS by using IDRS Command Code CFINK.

(10) If you receive a form that doesn't contain all the required items, it is invalid. If the form doesn't include all the types of tax, form numbers, and years or periods under examination, the form won't be valid for the missing types of tax, forms and/or tax years or periods. If there is missing information, contact the taxpayer or representative/designee and discuss the missing information.

(11) In addition to following the above guidelines for Disclosure of Official Information, there are specific requirements when working with Indian Tribal Governments.

1. Returns and return information of a tribal government may be disclosed to any person legally authorized to act for such government. Generally, verification that the requester is a government official, such as Treasurer or Comptroller, will be sufficient to indicate entitlement to returns and return information.

2. Requests for returns must be made in writing on appropriate governmental letterhead.

3. If the tribe, in a resolution of the tribal council or other exercise of its powers as a sovereign government, duly designates in accordance with regulatory requirements an individual or individuals as the primary point of contact for the IRS, ITG will honor that designation and contacts should be made through that individual. The designation may be made with regard to specific matters or on an on-going basis.

   Example: A tribe may provide specific protocol requirements on how the IRS (ITG) is to interact and contact the tribe or its entities when conducting government-to-government business.

   Caution: The Examiner should secure the Tribe’s specific protocol and/or policies from ITG on how to interact with and contact the tribal intergovernmental agency and its entities to conduct an examination. Note this in the CCR and add a copy of the protocol to the RCCMS file.

4. When the specialist has an on-going relationship with the tribe and is familiar with the official responsible for a particular matter, on-going contacts should be made with that official (provided that official has been duly designated by the tribe to receive returns and return information of that matter, or is otherwise authorized to receive returns and return information of the tribe because he/she is a tribal government official legally authorized to act for the tribe).

5. When there is any doubt as to the responsible official, the following steps should be followed:

Contact the local Bureau of Indian Affairs (BIA). The BIA Area Office may be contacted to assist in identifying the recognized tribal leadership and the location of the tribal offices. The IRS employee should not advise the BIA of the purpose of the inquiry. Inquiries should be made to the recognized leaders as to the responsible official(s) with regard to a particular matter. If the contact is in regard to a specific return and the signer of the return can be identified, that person will be treated as the responsible official provided the individual is still acting in the same capacity as when the return was signed and filed. If any doubts remain as to whom the responsible official is or who is entitled to return information, written instructions from the tribal government should be requested.

6. A tribe may have several entities with separate accounting staffs. There may be a different responsible official for each of these entities.

Example: A tribe may have the tribal government office, a housing authority, a health clinic, a casino, and a smoke shop.

(1) If a Form 2848 or Form 8821 is complete and valid, complete the block labeled "For IRS Use Only" with the examiner's name, phone number, function, and date the form was received.

(2) If a non-IRS POA form is complete and valid, date stamp the front of the form. Attach a completed Form 2848, with "IRS Use Only" section filled with examiner's name, phone number, function, and date so the form can be processed to the CAF system.

(3) If a non-IRS TIA form is complete and valid, date stamp the front of the form. Attach a completed Form 8821, with "IRS Use Only" section filled with examiner's name, phone number, function, and date so the form can be processed to the CAF system.

(4) In the top margin of the form notate the date the form was sent to the Service Center and the name of the specific Service Center.

(5) Fax a copy of Form 2848, Form 8821 or non-IRS forms, to the Service Center reflected in the table below as soon as possible. Please see the table for specific elements for each TE/GE function in Exhibit 4.70.11-1 below for instruction.

(6) If the CAF unit rejects the form, they issue Letter 861-C to the taxpayer. IDRS command code ENMOD indicates a notice was sent.

(7) Note in the CCR (EP, EO, TEB) or the Examining Officer’s Activity Record (FSL/ET and ITG) the date the form (Form 2848 or Form 8821) was received and the date it was sent to the Service Center.

(8) Maintain copies of all secured Forms 2848 (or Form 8821) in the RCCMS Office Documents folder when you close the case, use the RCCMS naming convention.

(1) Valid POA and TIA forms submitted by a taxpayer are always required to be honored unless the criteria for bypassing are met. See IRM 4.70.11.10.8.1, Bypass Procedures.

(2) Send correspondence and notices to the taxpayer and the authorized representatives/designee as requested in Part 1, Item 2 of Form 2848, per 26 CFR 601.506(a).

(3) Send copies of correspondence and other written communications to the authorized designee if Form 8821 item 2 is checked, or if the TIA is submitted in a document other than Form 8821, the document specifically requests copies be sent to the appointees.

(4) Use Letter 937-A, Transmittal of Information to Power of Attorney, to transmit correspondence to a POA.

(5) Blank forms, notices, and publications available on irs.gov should not be sent to the taxpayer’s representative or designee.

(6) If you expand the examination scope to include additional tax periods or different returns, notify the taxpayer. Give the taxpayer time to secure a new form to cover the additional periods or different return before you take any examination action. A new form should be submitted with the additional periods or different return, signed by both the taxpayer (or officer of the entity) and the representative/designee. If the taxpayer chooses not to have representation or designee for those additional periods/returns, then examination information for those periods/returns won't be disclosed to any person other than the taxpayer.

(1) If the taxpayer chooses to revoke an existing POA and not name a new representative, they must send a copy of the previously executed power of attorney to the IRS along with a cover letter. The taxpayer must:

1. Write "REVOKE" across the top of Form 2848.

2. Include in the cover letter: a written statement that the authority of the power of attorney is revoked and list the name and address of each recognized representative whose authority is being revoked along with the applicable return(s), tax matter(s) and year(s) (or if the taxpayer is completely revoking a representative, they may state: "remove all years/periods").

3. Sign and date the cover letter.

(2) If the taxpayer chooses to revoke an existing TIA and not name a new designee, they must send a copy of the previously executed Form 8821 to the IRS along with a cover letter. The taxpayer must:

1. Write "REVOKE" across the top of Form 8821.

2. Provide a current taxpayer signature and date under the original signature.

(3) If a representative wants to withdraw from representation, they must send a copy of the previously executed power of attorney to the IRS along with a cover letter. The representative must:

1. Write "WITHDRAW" across the top of Form 2848.

2. Include in the cover letter: a written statement that they are withdrawing from representing the taxpayer and the taxpayer’s name, TIN and address with the applicable return(s), tax matter(s) and year(s) alternatively the representative may indicate that they are withdrawing from "all years/periods".

3. Sign and date the cover letter.

(4) The taxpayer/representative must send the statement of revocation/withdrawal to the TE/GE group responsible for the case.

(5) The examiner or manager will forward the revocation/withdrawal request to the applicable Service Center.

(6) The filing of a Form 2848 automatically revokes all previously submitted Forms 2848 for the same tax matters and years or periods covered unless the box in item 6 of the Form 2848 is checked.

(7) The filing of a Form 8821 automatically revokes all prior TIAs on file unless the box on line 5 of Form 8821 is checked.

(8) If the taxpayer wants to keep previous representatives, they must check the box in Item 6 on Form 2848 and attach copies of the applicable Forms 2848 for those representatives to the new Form 2848 being submitted.

(9) If the taxpayer wants to keep previous designees, they must check the box in Item 5 on Form 8821 and attach copies of the applicable Forms 8821 for retained designees to the new Form 8821 being submitted.

(1) Form 2848 or Form 8821 can indicate a specific use by making an entry on line 4 for a specific issue authorization. For examples of specific-use authorizations, see IRM 21.3.7.8.12, Specific Use Authorizations.

(2) If you receive a specific-use POA/TIA form, save a copy in the RCCMS Office Documents folder indicating its relation to specific documents. The representative keeps the original form. Specific-use forms aren't recorded on the CAF system and therefore, don't have to be forwarded to a CAF unit. A specific-use form doesn't revoke any prior POA/TIA forms.

(1) IRS employees are authorized to accept a taxpayer's verbal consent to disclose return information to parties helping the taxpayer to resolve a federal tax matter (26 CFR 301.6103(c)-1(c)(2)). The regulation also clarifies that the taxpayer can verbally approve IRS disclosures to someone accompanying the taxpayer at in-person meetings with the IRS or participating in a phone conversation between the taxpayer and the IRS.

(2) See IRM 11.3.3.2.1, Requirements for Oral Authorization for procedures on verbal authorizations.

(1) IRC 7521(c) states that an examiner, with the approval of the group manager, may notify the taxpayer directly that such officer or employee believes such representative is responsible for unreasonable delay or hindrance of an IRS examination or investigation of the taxpayer.

(2) If taxpayer notification does not resolve the delays, the procedures to by-pass the power of attorney (POA) permit the examiner to contact the taxpayer directly and to request any information necessary to complete the examination. See IRM 4.11.55.4, Examining Officers Guide, Power of Attorney Rights & Responsibilities, By-Pass of a Representative.

(3) Under the "By-Pass Procedures" the POA continues to represent the taxpayer, and you must send all correspondence issued to the taxpayer to the representative. The taxpayer may at his/her discretion forward the requested information/documentation to you through the representative.

(4) The by-pass procedures do not constitute a disbarment or a suspension of the practitioner. The taxpayer still has a statutory right to representation per IRC 7521(c).

(1) To properly develop examination issues sometimes you may need to request:

1. Information from another IRS office.

2. The concurrent examination of another taxpayer in another IRS office.

(2) Use collateral examinations when:

1. The need to exchange information between areas is essential to resolve an issue of material consequence.

2. You cannot obtain the information from the taxpayer, the taxpayer’s representative, or third parties.

   Note: Attempt to secure the information rather than routinely requesting a collateral examination.

(3) A collateral examination is justified when:

1. An interview is required to obtain sworn testimony or affidavits.

2. A document is to be obtained.

3. A transcript of an account or a listing of invoices is needed.

4. A summons needs to be served.

(1) ITG specialists trained in tribal protocols are the primary IRS point of contact for all interactions with federally recognized Indian tribes and are responsible for:

1. Most IRS compliance activities with tribes.

2. Ensuring the IRS complies with relevant Presidential Executive Orders that outline the required relationships and protocols in working with tribes.

(2) ITG employees are specially trained in the unique areas of tax law and protocols applicable to Indian tribes.

(3) To alleviate potential problems and ensure that the IRS complies with existing legal requirements, all IRS employees must contact the Office of Indian Tribal Governments before initially contacting any Indian tribal government/enterprise account(s). Sometimes, a tribe may request that all IRS employees get the tribe’s approval before entering tribal lands when conducting IRS business. Contact: The IRS Office of Indian Tribal Governments.

(4) Because ITG coordinates all aspects of tax administration impacting tribes, ITG entered into a Memorandum of Understanding (MOU) with these parts of Small Business/Self-Employed (SB/SE) for the following:

(5) ITG interacts with other IRS offices:

(1) When making referrals within the IRS, research IDRS before you initiate a referral to see if the taxpayer is currently under examination in another business operating division. If so, contact the examiner to exchange information.

(2) Refer issues not within the scope of the current examination using a Form 5666, TE/GE Referral Information Report. “Complete Form 5666: IRM Exhibit 4.5.1-12” to “Complete Form 5666. IRM Exhibit 4.5.1-12 for instructions for preparing Form 5666.”

(3) As part of an examination, the examiner must determine whether an issue exists on a return that is not under the jurisdiction of their functional area.

(4) When dealing with referrals, this section covers the responsibilities of:

1. Examiners and

2. Group Managers

(5) Referrals should be made as soon as possible during the examination but no later than 30 days after you identify an issue.

(6) Save a copy of any applicable referral forms in the RCCMS Office Documents folder using the RCCMS Naming Convention.

(7) Indicate on RCCMS 3198-A Checksheet that the case file contains referral information.

(8) Document in the CCR the actions taken in making any referral.

(9) Complete Form 5666. See IRM Exhibit 4.5.1-12, Instructions for Preparing Form 5666, TE/GE Referral/Information Report.

(10) Securely email Form 5666 to Classification at *Manager EO Classification. Include a description of the referral, e.g., EP Referral, EO Referral, LB&I Referral, SBSE Referral, etc., in the subject line of the email.

(11) After making the referral, keep the case open until you receive feedback from the Business Unit or 20 workdays, then close the case.

(12) Use Form 8484, to report a complaint of suspected cases of misconduct by tax practitioners (attorney, CPA, enrolled agent, enrolled actuary, or enrolled retirement plan agent.

(13) Use Form 5666, to report a complaint about an unenrolled return preparer’s conduct to SB/SE Area Planning and Special Programs Office.

(14) EOE - Mandatory to prepare a referral requesting SB/SE Excise Tax using SRS for:

• Examinations of hospital cases.

• Examinations of college/university cases.

  Note: If SB/SE Excise Tax accepts the referral, the excise tax examiner becomes part of the EOE team. If SB/SE rejects the referral, discuss with your manager.

(1) Referrals to EP Determinations:

1. When you determine that a pre-approved Master & Prototype or Volume Submitter plan has erroneous language, make a referral to the Pre-Approved Plan Coordinator.

2. See Employee Plans Examinations Exhibits at Employee Plans Examination Exhibits for an example of a Pre-Approved Plan Referral Form.

3. Submit a copy of the plan sections in question and a copy of the opinion letter or advisory letter with the referral:

i. A copy of the plan sections in question.

ii. A copy of the opinion letter or advisory letter.

4. Mail the referral to:


Internal Revenue Service
Attention: Pre-Approved Plan Coordinator
550 Main St. Room 5106, Group 7521
Cincinnati, OH 45201

5. Refer income tax issues not within the scope of Form 1040/1120 Discrepancy Adjustments to an EFU on Form 5666.

6. Refer income tax issues on Forms 1041 resulting from a proposed plan revocation or disqualification to an EFU on Form 5666.

(2) Referrals to EP Examinations:

1. As part of an examination, the examiner must determine whether or not an entity has a 401(a), 401(k), 403(b), 408(k), 408(p), 457, or Social Security Alternative plan with any potential compliance problem that warrants a referral to Employee Plans.

2. When you are unsure of whether to request EP help for a related plan or to refer to TE/GE Referrals, complete Form 4632, Employee Plans Referral.

3. When completing Form 4632, use the following forms, as appropriate, to assist in making this determination:

Form 4632-A, Employee Plans Referral Checksheet.

Form 4632-B, Employee Plans Referral Checksheet for EO IRC 403(b)/457 Plans.

Form 4632-C, Employee Plans Referral Checksheet – For FSL/ET – IRC 403(b)/457 and Social Security Alternative Plans.

If a referral is indicated or if the Examiner has a question about a pension issue, then the Examiner should submit a request for assistance per IRM 4.70.12.3.5, Specialist Referral System. Note: The applicable Form 4632 checksheet provides guidance to the examiner of the appropriate questions to be asked to determine if an EP Referral is warranted. Use of the applicable checksheet can serve as an excellent workpaper related to the issue.

4. When you determine that the referral to EP Examinations is warranted, complete Form 5666 TE/GE Referral Information Report and send it along with the completed Form 4632 Employee Plans Referral and any applicable checksheet to *Manager EO Classification.

5. If a concurrent examination is recommended, do not complete Form 5666. Instead, complete Form 6229, Collateral Examination along with Form 4632 and the applicable checksheet and process according to IRM 4.70.11.15.1, Collateral Examinations, to request the collateral examination.

(3) Fraud Referrals:

1. If during your examination indicators of fraud are identified, discuss the indicators with your manager. If the manager agrees that indicators of fraud are present, the Functional Fraud Subject Matter Expert (SME) or the TE/GE Fraud Specialist should be contacted. See IRM 4.70.13.13, Fraud and Abusive Transaction Procedures.

Note: See the Fraud Contacts link on the on the TE/GE Home Page.

(4) Promoter and Abusive Transaction Referrals:

1. If during your examination, you suspect that the taxpayer has been involved in abusive transactions, discuss the transactions with your manager. See IRM 4.70.13.12, Fraud and Abusive Transaction Procedures, and IRM 4.70.3, Promoter Investigations.

2. When you become aware of a practitioner who may be promoting an abusive transaction, refer the transaction to the Lead Development Center (LDC) on Form 14242. See IRM 4.70.3.3.3, SB/SE Lead Development Center for an example of a completed Form 14242. “See IRM 4.70.3.3.3, SB/SE Lead Development Center for additional information about LDC.”

3. Send completed LDC Referral Forms through encrypted email or e-fax l to *LDC, or e-fax to 877-477-9135.

(5) Tax Exempt Bonds:

1. Use the Specialist Referral System (SRS) or Form 5666 TE/GE Referral Information Report to refer a potential noncompliant bond issuance to the TEB Referral Coordinator. Detailed instructions for completing the form are located in IRM Exhibit 4.5.1-12,  Instructions for Preparing Form 5666.

2. Complete a separate Form 5666 with all information that is available about the issuer of the bonds and the nature and size of the potential noncompliance issue.

Include information pertaining to the source of the EO examination and attach any news articles, correspondence or other documentation concerning the potential noncompliance issue with the Form 5666.

The referral package should be as complete as possible with objective information to facilitate the TEB Classifiers in making their recommendations of compliance actions.

Use the proper AIMS Source Codes for each referral. The following guidance will assist the originator in determining the proper source code for referrals and the preparation of Form 5666 or the Specialist Referral System.

Use the appropriate source codes based on the EO examination. TEB source codes are identified in the GE Computer Systems Codes Book, Document 11308.

(6) Emerging Issues:

1. CP&C maintains the Compliance Issue Submission Portal for use when you discover a potential emerging issue.

2. The Portal should be used to submit TE/GE compliance issues that may have widespread effect. See TE/GE Compliance Issue Submission Portal.

3. The Portal helps enable TE/GE to leverage examination experiences to pursue non-compliance actions with a broader base of taxpayers.

4. CP&C reviews all submitted issues to determine the level of non-compliance and determine if a Compliance Strategy is warranted.

(1) Exam Functional Units:

1. Prepare Form 5666 TE/GE Referral Information Report and forward to Classification as described in IRM 4.70.11.15.3(10), General Referral Process within the IRS.

2. Prepare Form 6229 Collateral Examination if it is urgent that another Business Unit conduct a coordinated examination of a related return. See IRM 4.70.11.15.1.1(2), Collateral Examination Procedures Initiating Area.

(2) For assistance from another Business Unit when a referral is not warranted, use the Specialist Referral System (SRS) online at the SRS home page. See IRM 4.70.12.3.5, Specialist Referral System.

(3) If the taxpayer refuses to file a required return and the return is:

1. Under EP jurisdiction, discuss the issue with your manager and determine whether to start an examination of that year.

   Note: Refer to DOL when the taxpayer refuses to file. Send the original Form 6212-B to Classification and save the referral in the RCCMS Office Documents folder.

2. Not under EP jurisdiction, refer to the appropriate unit on Form 5666.

(1) Department of Labor/Employee Benefits Security Administration (DOL/EBSA):

1. When you suspect a breach of fiduciary responsibility under ERISA regarding the operation of a retirement plan under the jurisdiction of the DOL/EBSA, complete Form 6212-B Examination Referral Checksheet B.

2. Make a referral to DOL/EBSA when any question on Form 6212-B is answered yes. when you’re proposing plan revocation /non-qualification, or if you determine that a plan covering only one participant (or participant and spouse) should cover additional people.

3. When you make a referral to DOL, email Form 6212-B to the FAC/EP DOL Coordinator. Include any relevant information about the referred issue, including a copy of the RAR if there is an unagreed IRC 4971 issue, IRC 4975 issue or a proposed revocation.

Note: The attachments you include with Form 6212-B will not be sent to DOL/EBSA but will be kept by Classification. When Classification receives DOL/EBSA’s written request, they release relevant information as required by IRC 6103(l)(2).

4. Select the “DOL Participation Requested” block on Form 6212-B only when DOL/EBSA’s joint participation is needed and for all unagreed cases involving IRC 4791 and IRC 4795 excise tax.

5. Hold any examination for which Form 6212-B is referred open until you receive a response or 30 days from the date sent to Classification, if earlier.

6. The IRS will delay action in a case when, as a result of a referral of a checksheet between the agencies, the DOL/EBSA Regional Office advises the Manager, Classification, in writing that the DOL/EBSA Regional Office referred the case to the DOL/EBSA National Office. The IRS does not take further case action until DOL/EBSA notifies the Classification Unit of their final action in the case.

   Exception: The IRS works the case when collection of a tax is in jeopardy, the statute of limitations expires soon, or the plan assets or the plan participants’ interest must be protected.

   Note: If the IRS must work a case, the IRS will immediately notify DOL of the action by calling them and confirming in writing within five workdays.

7. Document the CCR whether the IRS made a referral to EBSA.

(2) Pension Benefit Guaranty Corporation (PBGC).

1. Most defined benefit plans are covered by PBGD insurance. ERSIA section 4021(b) lists plans that aren’t covered. Defined benefit plans not covered include:

Plans offered by professional service employers (i.e., doctors and lawyers) that have never had more than 25 active participants.

Plans outside the United States for nonresident aliens.

Plans established exclusively for one or more substantial owners.

Church plans, as defined by IRC 414(e), unless the plan has made an election under IRC 410(d) to be covered and has notified PBGC that it wishes to be covered.

Plans sponsored by federal, state and local governments.

2. The PBGC has jurisdiction of retirement plans covered by Title IV of ERISA.

3. When making a referral to the PBGC, consider the questions on Form 6533 Examination Referral Worksheet. If one or more of the answers in the right-hand column can be checked, a referral to the PBGC is warranted. If none of the boxes are checked in the right-hand column, do not refer to the checksheet to the PBGC.

4. When you determine a referral to the PBGC is warranted, send the Form 6533 referral to:


Pension Benefit Guaranty Corporation - Chief Negotiating Actuary
Corporate Finance and Negotiations Department
1200 K Street, NW, Suite 270
Washington, DC 20005-4026

5. Email a copy of the Form 6533 to Classification at the address listed in the exhibit under Contact Information for Business Units and Sub-functions, with a note stating when you sent the original referral to the PBGC. See Exhibit at Employee Plans Examination Exhibits.

6. You don’t have to hold the case for any length of time after you make the referral.

(1) When a group receives a referral, the manager should immediately evaluate and assign the case.

(2) The examiner responsible for the case will contact the EFU examiner, Determinations specialist, ep/EO Examinations, FSL/ET, ITG, TEB examiner, or EBSA investigator within 30 workdays of the group's receipt of Form 4632 Employee Plans Referral (with checksheet 4632-A, 4632-B, or 4632-C, as applicable), Form 5346 Examination Information Report, Form 5666 TE/GE Referral Information Report or Form 6212-A Examination Referral Checksheet A if the related case is being held open in the EFU or in EBSA.

(3) If a related examination is open in EP, EO, FSL/ET, ITG, TEB, EBSA, or an EFU, or determination is open in EP or EO Determinations, make every attempt to resolve every issue within 90 days of your group’s referral receipt. If the case is not closed within 90 days, the group manager should contact the referring group manager to update them on the status of the examination.

(4) Examiner: Once you resolve the referral:

1. Prepare a brief examination report on findings on the referred issue. Use Form 886-A, Explanation of Items, or a memo.

2. Send the examination report and a copy of the referral (Form 4632 or Form 6212-A) directly to the examiner/investigator if they have a related examination open and are anticipating an update. Send a copy of the examination report and the referral to Classification.

3. Notify the Determinations specialist of the issue(s)’ resolution, if they have a related open determination case and are expecting an update.

4. Document Form 5464 Case Chronology Record.

5. Save a copy of the examination report and referral package in the RCCMS Office Documents folder using the RCCMS Naming Convention.

(1) If a TE/GE function receives a referral directly from one of those listed here, then the group should email referrals to the TE/GE Referrals group in Classification at the email address in paragraph (4) of IRM 4.70.11.15.3, General Referral Process within the IRS.

1. Other agencies (e.g., DOL/EBSA)

2. Other TE/GE functional units

3. Individual taxpayers

4. Examiners from an EFU

(2) If a referring entity does not prepare a referral form, the receiving group should prepare the applicable referral form and send it to the TE/GE Referrals group.

(3) An examiner will prepare and mail Letter 4426 Acknowledging Receipt of Information from Third Party about Tax Exempt or Government Entities if classification doesn’t prepare the letter for referrals received by TE/GE from the public or other government entities.

(4) Do not begin any compliance activity for a referral unless you receive it from Classification or Classification approves the decision to examine.

(1) These procedures apply to EP Large Case Support Examinations coordinated with LB&I or EO Exam.

(2) The three types of EP Large Case Support Examinations are:

1. Deduction Only Support Examinations - restricted to income tax issues.

2. LB&I Support Examinations Involving Plan Qualification - involve IRC 401(a) plan qualification support, which may include the deduction.

3. EO Support Examinations Involving Plan Qualification - involve IRC 401(a), IRC 403(b) and IRC 457 plan support, which may include the plan sponsor's deduction for contributions to its retirement arrangement.

(3) Every EP Large Case Support Examination with LB&I or EO Exam requires examiners to complete and include an exam plan in the EP examination case file, which at a minimum should describe the extent of the EP examination activity.

(1) After debriefing, taint review, and selection for examination, CP&C, Classification and Case Assignments (C&CA) assigns the case to an examination group.

(2) When the examination group receives a WB examination case, the group manager must contact the appropriate C&CA manager to request the WB electronic file be sent to the group. The group will generally receive two files:

1. The examination case file.

2. The WB case file which contains the Form 211 and the documentation submitted by the WB.

   Note: There may be multiple Forms 211 included in one case file.

(3) An ICE indicator code “1” will be on the primary return on AIMS. The freeze code will need to be changed on AIMS as shown below, before the case can be closed from group level.

(4) Except as detailed below, follow the normal examination procedures.

(5) The WB case file instruction should be in the WB case file. This document gives the examination group basic procedures and guidance for the WB aspects of the examination.

(6) WB communications are confidential. If there are paper files, transmit all claims, reports, and information from office to office in double sealed confidential envelopes marked, “To be Opened by Addressee Only” and keep them locked in file cabinets. Use secure email for all electronic submissions.

(7) Keep all WB information separate from the examination case file. If there is a hard copy WB case file, keep it locked up when not in use.

(8) DO Not mention the WB in either the examination case file in RCCMS or in the hard copy examination case file. This includes not mentioning the existence of a WB in any of the examination files such as the Case Chronology Record and workpapers. The taxpayer can’t be informed there is a WB.

(9) The examiner shouldn’t make any contact with the WB. If the examiner wants to interview the WB, contact your WB Coordinator.

(10) Develop the issues by seeking independent corroboration and/or refutation of the WB provided information. Independently developed information must form the basis for any proposed adjustments.

(11) Electronically prepare Form 11369, Confidential Evaluation Report on Claim for Award, when the examination is fully concluded, but prior to final closing. You and your manager must sign the form.

(12) The WB Office uses information on Form 11369 Confidential Evaluation Report on Claim for Award, as well as any relevant workpaper information to determine if an award is paid.

(13) DO NOT leave WB information or references to a WB in the closed examination case file; even if you close the case unagreed.

(14) If the examination case file is going to Appeals, DO NOT include any WB information or the Form 11369 Confidential Evaluation Report on Claim for Award in the examination case file sent to Appeals.

(1) WB Awards must consider proceeds, which may include penalties, fines and forfeitures. See IRC 7623(c).

(2) If the WB claim has any actions outside of U.S. Code Title 26, like Title 18 or Title 31, attach additional information to Form 11369 Confidential Evaluation Report on Claim for Award, that documents:

1. What actions were taken outside Title 26.

2. How WB information was used to identify and develop issues, facts or evidence and

3. Any other agencies that were involved.

(3) Refer to the Whistleblower Office website for additional guidance.

(1) A Category “A” case is any WB Claim that isn’t a Category “B” case.

(2) If you open additional years or returns, contact the Informant Claims Examination (ICE) unit to add the ICE indicator on AIMS for the additional years or returns. Find the contact information for the ICE unit in the instructions for Form 11369 Confidential Evaluation Report on Claim for Award.

(3) If at any time, the amount of potential proceeds (e.g. taxes, interest and penalties) is $2 million or more, contact the WB Coordinator.

(4) After you prepare Form 11369 send the following information to the ICE unit:

1. Completed Form 11369.

2. WB case file.

3. Copy of an RAR, if applicable.

4. Copy of a Closing Agreement, if applicable.

5. Case Chronology Record or Activity Record (depending on which form your division uses).

6. Workpaper Summary or Workpaper Index (depending on which form your division uses).

7. All relevant workpapers which will help the WB Office to determine the award.

   Note: If there’s a hard copy WB case file, mail it back to the ICE unit. Otherwise, send it electronically using secure email.

(5) The WB Coordinator reviews the information, makes sure it’s complete, then sends it to the WB Analyst.

(6) Once the ICE unit has all the necessary information, they change the ICE indicator to “2”. Once the indicator is changed, close the case under normal closing procedures.

(1) A Category “B” case is one in which the proceeds in dispute exceed $2,000,000. In the case of an individual, the individual’s gross income must also be greater than $200,000 for any taxable year subject to the action. An informant submits Whistleblower (WB) claims on Form 211, Application for Award for Award for Original Information.

(2) WB claims are either “A” or “B” Claims. These letters refer to the applicable sub-sections of IRC 7623. A WB action against an individual is only a “B” case if the individual’s gross income exceeds $200,000 for any taxable year subject to the action.

(3) If you open additional years or returns, contact the WB Coordinator. The Coordinator will contact the ICE unit to add the ICE indicator on AIMS for those additional year or returns.

(4) After Form 11369 Confidential Evaluation Report on Claim for Award is prepared and the examiner has ensured that no WB materials remain in the case file, the following information is sent to the WB Coordinator:

1. Completed Form 11369.

2. WB case file.

3. Copy of RAR, if applicable.

4. Copy of a Closing Agreement, if applicable.

5. Case Chronology Record or Activity Record (depending on which form your division uses).

6. Workpaper Summary or Workpaper Index (depending on which form your division uses).

7. All relevant workpapers which help the WB Office to determine the award amount.

   Note: If there’s a hard copy WB case file, mail it to the WB Coordinator. Otherwise, send electronically, using secure email.

(5) The WB Coordinator reviews the information, makes sure it’s complete, then sends it to the WB Analyst.

(6) Once the WB Analyst has all the necessary information, they change the ICE indicator to “2.” Once the indicator is changed, close the case under normal case closing procedures.