4.60.4  LMSB International Programs

4.60.4.1  (09-01-2004)
Objectives of International Field Operations

  1. The objectives of International Field Operations are to:

    1. Ensure that U.S. and foreign taxpayers receive the best possible assistance in meeting their U.S. tax responsibilities arising from international transactions;

    2. Ensure that the staff and resources of International Programs are utilized in the most effective manner;

    3. Ensure voluntary compliance through a vigorous but fair and equitable audit program/compliance activities; and,

    4. Ensure that personnel responsible for addressing international related matters are provided the necessary training and resources.

4.60.4.2  (09-01-2004)
Organizational Responsibility for Carrying Out International Field Operations

  1. The Director, International (LMSB) reports to the Commissioner, Large and Mid-Size Business Division (LMSB) and has program support, coordination, and oversight responsibility for International Field Operations, as well as shared primary responsibility for developing, implementing, and realization of LMSB’s Globalization Strategic Initiative.

  2. The Manager, International Programs, reports to the Deputy Director and Director, International (LMSB) and has primary responsibility for maintaining liaison and coordinating with all functions within LMSB, other Operating Divisions and Units, LMSB Division Counsel, Office of Associate Chief Counsel (International), and the Department of Treasury to ensure the effective administration of U.S. international tax laws.

  3. Directors of Field Operations (DFOs) are aligned by the five designated LMSB industries and are under the authority of the Industry Directors. Directors of Field Operations have operational and oversight responsibility for international programs within their industry.

  4. International Territory Managers report to the DFOs and have day to day oversight and authority for international field operations within their territory.

  5. International Team Managers report to International Territory Managers and are aligned by industry. International Team Managers manage international groups and are responsible for the examination/compliance activities undertaken by the groups.

4.60.4.3  (09-01-2004)
Scope of Responsibility, Office of Director, International

  1. Provides program support, coordination, and oversight for International Field operations.

  2. Shares primary responsibility for implementing LMSB’s Globalization Strategic Initiative. This initiative is designed to build a tax administration to effectively deal with the global economy by:

    1. Enhancing customer service and compliance.

    2. Increasing internal capabilities.

    3. Designing the organizational structure (Integrating International capabilities throughout LMSB).

    4. Building strategic alliances.

  3. Provides leadership and guidance to other IRS Operating Divisions and Units on international matters.

  4. Provides Service-wide support for international tax administration meetings, seminars, and training sessions.

  5. Fosters fair and effective administration of tax laws in cooperation with international organizations and foreign tax administrations, as appropriate.

  6. As U.S. Competent Authority, responsible for timely and effective implementation of U.S. tax treaties and tax information exchange agreements.

  7. Identifies emerging international issues, provides tax assistance to U.S. taxpayers residing overseas, and, when requested, assists foreign governments in improving the fair and effective administration of their internal tax systems.

  8. Provides leadership and coordination to other IRS Operating Divisions and Units on tax administration issues related to electronic commerce.

4.60.4.4  (09-01-2004)
Scope of Responsibilities, Manager, International Programs (Office of Director, International)

  1. Provides national program support, coordination and oversight for effective operation of International Field Operations, in connection with the International Territory Managers, the DFOs, and the Industry Directors.

  2. Coordinates with and provides support for international research and planning in the office of Strategy, Research & Program Planning, LMSB.

  3. Coordinates with and provides support for the international initiatives in the office of Pre-Filing and Technical Guidance functions, LMSB.

  4. Coordinates with and provides support for the international initiatives in the office of Quality Assurance & Performance Management, LMSB.

  5. Maintains liaisons and coordinates with all functions of LMSB, other Operating Divisions and Units, LMSB Division Counsel, Office of Associate Chief Counsel (International), and the Department of Treasury to ensure effective administration of U.S. international tax laws.

  6. Responds to Congressional inquiries regarding globalization and international tax compliance, as appropriate, in coordination with other responsible offices.

4.60.4.5  (09-01-2004)
Scope of Responsibility, International Territory Managers (ITMs)

  1. The responsibilities and duties of the International Territory Manager include, but are not limited to, the following:

    1. Ensure an effective international compliance program, in coordination with the Office of International Programs, under the direction of Industry Directors and the Directors of Field Operations.

    2. Work jointly and cooperatively with other LMSB Territory Managers to ensure effective utilization of international resources to meet the Business Plan and strategic goals of LMSB.

    3. Ensure that international resources are effectively utilized.

    4. Work with local International Team Managers and other Territory Managers to ensure that the international examination resources are applied to cases that have the greatest compliance risk, regardless of the industry or type of return.

    5. Maintain liaison and communication with SB/SE, W&I, and TEGE representatives to ensure that their needs for international support and assistance are met.

    6. Support International Programs in carrying out its responsibilities and functions, as appropriate.

    7. Ensure that taxpayers are serviced effectively and efficiently.

    8. Support and participate in LMSB initiatives to meet the challenges of globalization and its implications for tax administration.

    9. Ensure that International team managers and examiners have sufficient training and support necessary to perform their duties and responsibilities effectively.

    10. Support the Office of Associate Chief Counsel (International), Office of APA Program and PTFG pre-filing initiative by providing compliance resources when and where appropriate.

    11. Support Electronic Commerce initiatives.

    12. Coordinate with Tax Treaty to ensure that cases with potential treaty issues are properly developed and that administrative procedures are adhered to.

    13. Support tax shelter initiatives involving foreign entities.

  2. International Territory Manager has the responsibility to ensure that all taxpayers are accorded the respect, courtesy and high quality service expected from the IRS.

4.60.4.6  (09-01-2004)
Scope of Responsibility, International Team Managers

  1. The duties and responsibilities of the International Team Manager include, but are not limited to, the following:

    1. Coordinate with International Territory Manager to ensure that the LMSB Business Plan and strategic goals are achieved.

    2. Communicate regularly with the International Territory Manager on international field activities; bring to his or her attention any deficiencies or potential deficiencies that may impair the effectiveness of the international objectives.

    3. Ensure that the international team is adequately trained and has the team's resources necessary to deliver an effective international program.

    4. Manage and control international referrals from LMSB and SB/SE, ensuring that those with the highest compliance risk are worked regardless of industry or type of return.

    5. Assign international workload in a timely manner.

    6. Ensure quality delivery of all aspects of the international program under his or her authority.

    7. Collaborate with other team managers to jointly plan international resource needs on Coordinated Industry Cases (CIC) and Industry Cases (IC).

    8. Collaborate with other team managers to ensure effective management of CIC and IC examinations involving significant international activity by the taxpayer and/or commitment of resources by the program.

    9. Effectively support the international classification program.

    10. Ensure that international resources are effectively utilized.

    11. Provide continuing professional education and career development opportunities to international examiners.

    12. Ensure that all IEs adhere to the highest professional and ethical standards in accomplishing their authorized assignments.

  2. International Team Managers may also be designated as an International Referral Recipient (IRR). An IRR’s duties and responsibilities include coordinating with other International Team Managers in the same geographical area in order to assign referrals in a manner consistent with the objectives of the International Program.

  3. International Team Managers have the responsibility to ensure that all taxpayers are accorded the respect, courtesy and high quality service expected from the IRS.

4.60.4.7  (09-01-2004)
Scope of Responsibility, International Examiner

  1. The duties and responsibilities of International Examiners include, but are not limited to:

    1. Examine assigned tax returns with international activities or foreign affiliates.

    2. Assist domestic agents with the examination of international features of the tax return.

    3. Participate in compliance studies of taxpayers in the international area.

    4. Participate in Advanced Pricing Agreement (APA) and other pre-filing programs.

    5. Conduct training and seminars.

    6. Support the LMSB international objectives and initiatives.

  2. The International Examiners are involved in a complex and sophisticated area of tax administration. The issues they are called upon to deal with include, but are not limited to:

    1. Controlled foreign corporation issues

    2. Foreign personal holding company issues

    3. IRC 367 issues – international organization, reorganization, and disposition issues

    4. IRC 482 issues – transfer pricing

    5. Complex foreign tax credit issues

    6. IRC 942, 943 issues – extraterritorial income exclusion

    7. International Boycott

    8. Form 1042 - annual withholding tax

    9. Form 1120F - U.S. income tax return of a foreign corporation

    10. Form 1040 with a Form 2555 - foreign earned income

    11. Form 1040 with a Form 1116 - foreign tax credit

    12. Form 1120 FSC - foreign sales corporation

    13. Form 1120 IC-DISC – interest charge-domestic international sales corporation

    14. Foreign currency transactions

    15. IRC 165(g) foreign losses

    16. Transactions involving foreign partnerships, joint ventures and disregarded entities.

    17. Corporate tax shelters involving foreign entities.

  3. Refer to IRM 4.60.6.9 for procedures pertaining to IE control of "limited scope audits."


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