IRS TEAM Pilot Program

TAX BRIEF

Good news for CPAs helping clients get guidance from the IRS. Revenue procedure 2002-30 explains a pilot program to test whether the IRS can streamline its process for issuing a technical advice memorandum (TAM). The new guidance will be known as a technical expedited advice memorandum (TEAM). During the pilot program only disagreements under the jurisdiction of the IRS associate chief counsel, income tax & accounting, are eligible for a TEAM. The pilot procedures remain in effect until the IRS issues revenue procedure 2003-2; if the new program is successful, the chief counsel expects to expand it to cover other tax issues.

The IRS intends the TEAM pilot program to expedite certain aspects of the TAM process and to eliminate problems that may delay a TAM. The chief counsel’s office will provide an answer to a taxpayer query even if the auditor and the taxpayer disagree on the facts. The office, in appropriate circumstances, may issue two separate answers: one based on the auditor’s factual submission and the other based on the taxpayer’s. However, both the taxpayer and the IRS agent or appeals officer must agree the issue is appropriate for the TEAM process; if not, the IRS will handle it under existing procedures.

Observation. CPAs will be pleased to know the IRS expects to issue TEAMs within 60 days. Currently, it must issue TAMs within 120 days. However, approximately 40% of pending requests have not met that deadline, with some delayed up to one year. If a TEAM provides alternative responses based on separate sets of facts, IRS field agents will not be required to process the case on the basis of the TEAM’s conclusions, as revenue procedure 2002-2 requires for a TAM.

—Lesli S. Laffie, JD, LLM, editor, The Tax Adviser.