4.75.35  EO ATAT Committee Operating Procedures

4.75.35.1  (01-26-2007)
Introduction

  1. The IRS, as part of its focus on facilitating Service-wide communication and coordination in the identification and investigation of abusive transactions and schemes, established a Service-wide executive committee (SAT/ESC). In support of the Service-wide executive committee’s goals, Exempt Organizations has created its own committee. The committee, called the EO ATAT Committee, reviews potentially abusive transactions and schemes so that these abuses are handled in the most effective and strategic manner possible.

  2. These procedures provide how the EO ATAT Committee operates and how it assists in the communication and coordination of abusive transactions, both within EO and with other IRS operating divisions.

4.75.35.1.1  (01-26-2007)
Objectives

  1. The objectives of the EO ATAT Committee are to:

    • Identify emerging issues that involve potentially abusive tax avoidance transactions

    • Analyze potential abusive transaction referrals and to make recommendations regarding their disposition; coordinating as appropriate, with other IRS divisions and functions

    • Serve as a touch point to other Service areas and flag trends, issues and deficiencies in EO’s ATAT program

4.75.35.2  (01-26-2007)
Referrals

  1. EO ATAT Committee receives case and issue referrals from various sources.

4.75.35.2.1  (01-26-2007)
Sources of Referrals

  1. The following are some of the sources of referrals to the EO ATAT Committee:

    • EO — Dallas Classification Center

    • EO — Touch-and-Go Procedures (TAG)

    • EO — Financial Investigative Unit (FIU)

    • EO — Accelerated Case building Unit (ACB)

    • EO — Other

    • Employee Plans (EP)

    • Governmental Entities (GE)

    • Tax Exempt and Government Entities (TEGE)

    • Small Business / Self-Employed (SBSE)

    • SBSE Lead Development Center (SBSE LDC)

    • Large and Mid-Size Business (LMSB)

    • LMSB — Office of Tax Shelter Analysis (OTSA) Hotline

    • OTSA Disclosure Form 8886

    • Criminal Investigation (CI)

    • Treasury Department

    • Articles in the newspaper, technical journals, etc.

    • Contact from informants

    • Contact from Congress

    • Questions from practitioners, taxpayers, and exempt organizations themselves

    • Other

4.75.35.2.2  (01-26-2007)
Dallas Classification

  1. Internal and External Referrals

    • All ATAT referrals, with two exceptions, first go to Dallas Classification. Dallas Classification performs routine research on the referral, if necessary. Dallas Classification promptly sends the referral and accompanying research to the EO ATAT Program Manager and the EO Exam Representative on the EO ATAT Committee.

  2. TAG Referral Exception

    • All TAG referrals will be sent directly to the EO ATAT Committee as discussed below.

  3. If Dallas Classification Has Copy of Referral Exception —

    • If a non-TAG referral comes to EO ATAT other than from Dallas Classification, but Dallas Classification was copied on the referral, the referral does not have to be resubmitted to Dallas Classification. Example: If Dallas Classification sends the referral to the FIU, but the FIU wants to send the referral to the EO ATAT Committee, the FIU can send the referral directly to the EO ATAT Committee since Dallas already has a copy of the initial referral.

  4. If Referral First Goes to EO ATAT —

    • If the EO ATAT Committee receives a referral that (1) is not TAG and (2) has not gone through Dallas Classification, and (3) Dallas Classification has not seen a copy of the referral as noted above, the Program Manager promptly sends Dallas Classification a copy of the referral. Dallas Classification performs routine research on the referral, if necessary, and then promptly sends any additional research that it performs to the EO ATAT Program Manager and the EO Exam Representative on the EO ATAT Committee.

4.75.35.2.3  (01-26-2007)
Receipt of Referral

  1. Acknowledgment of Referral

    • The Program Manager acknowledges the referral via email within three business days of receipt. This acknowledgment states the date of the next Committee meeting when the referral will be considered.

  2. Tracking System

    • The Committee uses a specifically tailored tracking system to track referrals. The tracking system is continually updated to reflect all aspects of the Committee’s handling of the referral. The Program Manager or his/her Assistant is responsible for updating the tracking system.

  3. Distribution of Referral

    • The Program Manager and/or Assistant will distribute the referral to all Committee members either via facsimile or email within three business days of receipt.

4.75.35.3  (01-26-2007)
Committee Procedures

  1. Meetings

    • Schedule — Committee meets during the third week of each month. All referrals will be considered at the upcoming Committee meeting. However, if the referral has been received less then five business days prior to the meeting, it will be considered at the following Committee meeting.

    • Minutes — Minutes are taken at each meeting and are distributed via email within five business days of the meeting to each Committee member, the EO Executives, the TAG coordinators, Dallas Classification, and the Deputy Division Commissioner.

    • Agenda — Committee inserts into the agenda for each monthly meeting status updates on the emerging significant potential ATATs.

4.75.35.3.1  (01-26-2007)
Initial Considerations

  1. If Significant Issue — Notification

    • EO Executives — The Program Manager will, within five business days of receipt, notify EO Executives of the significant issue referral, with a copy to the referring entity (Dallas Classification or TAG).

    • Other EO Units — If referral presents issues that may impact other EO units, the Program Manager will within five business days of receipt notify appropriate EO personnel (for example, the TAG coordinators).

  2. Insufficient Information for Committee to Consider Referral

    • A specified Committee member will perform minor research (such as checking LDC/OTSA databases, TAG alerts, GuideStar for filed Form 990’s, etc.) and/or

    • Re-submit the referral to Dallas Classification for further development.

  3. If Referral Does Not Involve an ATAT

    • TAG — If the referral was sent to EO ATAT from the TAG coordinator, the Program Manager for EO ATAT will return the referral via email or facsimile, recommending the appropriate office to make the referral. For example, a fraud referral would be returned to the TAG coordinator with a recommendation that it be sent to the EO FIU. The TAG group is then responsible for sending the referral to the appropriate office.

    • Dallas Classification — If the referral was sent to EO ATAT from Dallas Classification, the Program Manager for EO ATAT will via email or facsimile return the referral to Dallas Classification with a recommendation. Dallas Classification is then responsible for sending the referral to the appropriate office.

4.75.35.3.2  (01-26-2007)
TAG: Promoter?

  1. If Determinations/TAG Referral —

    • 6700 Memo — If the Committee decides the issue is an ATAT issue and a promoter is involved, a designated Committee member will review the referral memorandum prepared by Determinations to support authorization of a 6700 investigation. After the memorandum is approved by the Committee, the Committee will then forward it to the LDC with copies to the TAG coordinator and the Manager, EO Technical.

    • Notification of EO Executives — The Program Manager will, simultaneously with the memorandum referral to the LDC, send an email to the EO Executives telling them briefly of the issue and attaching a copy of the memorandum.

    • Status Reports — The same designated Committee member will contact LDC periodically for updates on the referral and will inform the EO Executives, the TAG coordinator, the Manager, EO Technical, and the Committee members of the current status.

    • Recommendations — If the Committee has a recommendation in addition to the referral to the LDC, it will send its recommendation to the referring person without prior approval from EO Executives. A designated Committee member will inform the EO Executives and other EO units, as appropriate, of its recommendations.

4.75.35.3.3  (01-26-2007)
Exam/Dallas Classification: Promoter?

  1. If EO Examinations/Dallas Classification Referral —

    • 6700 Memo — EO Examinations will forward the 6700 memorandum directly to the LDC with a copy to the Program Manager.

    • Notification of EO Executives — The Program Manager will, simultaneously with the memorandum referral to the LDC, send an email to the EO Executives telling them briefly of the issue and attaching a copy of the memorandum.

    • Status Reports — A Committee member will contact LDC periodically for updates on the referral and will inform the EO Executives, the appropriate representative from Exam, and the Committee members of the current status.

    • Recommendations — If the Committee has a recommendation in addition to the referral to the LDC, it will send its recommendation to the referring person without prior approval from EO Executives. A designated Committee member will inform the EO Executives and other EO units, as appropriate, of its recommendations.

4.75.35.3.4  (01-26-2007)
Internal Referral?

  1. If an EO Issue Management Team (IMT) or other EO compliance group has already been established to study the issue contained in the referral, the Program Manager will ensure that the IMT or other compliance group has received a complete copy of the referral. A designated Committee member will keep track of the referral and give status updates to the Committee members at its monthly meetings.

  2. The EO IMT or other EO compliance group will take primary responsibility of the referral. At that point, the Committee’s role is to act as a resource for the Compliance Group.

4.75.35.3.5  (01-26-2007)
External Referral?

  1. If an IMT or other compliance group has been established outside of EO, then a designated Committee member will forward the referral, with a copy to Dallas Classification or the TAG coordinator, and to the EO representatives on the IMT or other compliance group. If no EO representatives are on the IMT or other compliance group, then the referral will be made to the contact person listed for the IMT or other compliance group. A designated Committee member will keep track of the referral and give status updates to the Committee members at its monthly meetings.

4.75.35.3.6  (01-26-2007)
Recommendations Involving Significant Resources

  1. A designated Committee member will prepare a formal memorandum containing the Committee's recommendations, which the Program Manager will forward to the EO Executives for approval. The EO Executives will respond to the Program Manager regarding the Committee’s recommendation within the time provided for in the memorandum. If the Program Manager does not hear from the EO Executives within the time prescribed, then the Program Manager will schedule a meeting with the EO Executives to obtain their approval.

4.75.35.4  (01-26-2007)
Specific Procedures — Touch-and-Go (TAG)

  1. Informal Requests

    • Requests by the TAG coordinator for informal advice regarding potential TAG referrals will be sent via email using secure messaging to the Program Manager, with a copy to the Assistant Program Manager and the Manager, EO Technical. The Program Manager will respond to the TAG coordinators within five business days of receipt of the request for informal advice. A copy of the Program Manager’s responding email will be sent to all Committee members and the Manager, EO Technical.

4.75.35.4.1  (01-26-2007)
Forwarding a Referral to EO ATAT Committee

  1. TAG referrals are sent to the EO ATAT Committee as follows:

    • By mail:
      Exempt Organizations
      Internal Revenue Service
      Attention: EO ATAT Committee Program Manager
      SE:T:EO:RA:T:3, 3K4
      1111 Constitution Ave., NW
      Washington, DC 20224

    • By facsimile:
      Attention: EO ATAT Committee Program Manager
      (202) 283-8937

    • By email:
      Via Secure Messaging System
      To the Program Manager, EO ATAT Committee

4.75.35.4.2  (01-26-2007)
Steps

  1. Confirming Email — Upon receipt of the referral, the Program Manager will send a confirming email to the TAG coordinators within three business days of receipt.

  2. Distribute Referral — The Program Manager will disseminate the referral to the Committee members within three business days of receipt. The Program Manager will place the referral on the agenda of the next EO ATAT Committee monthly meeting.

  3. Recommendation — The Committee will consider the referral and make a recommendation regarding how EO should proceed. The Program Manager or his/her Assistant will inform the TAG coordinator within five business days of the meeting regarding the recommendation. The EO ATAT Committee may decide that an Advisory Group is needed.

4.75.35.4.3  (01-26-2007)
ATAT?

  1. Not ATAT —

    • If the Committee decides the referral is not an ATAT, the Committee will return the referral to the appropriate unit (for example, if the referral involves fraud, the recommendation would be that the referral should be sent to the FIU), with a copy to the TAG coordinator

  2. ATAT — If the Committee decides the referral involves an ATAT, then:

    • Establish Advisory Group — The Committee may decide that an Advisory Group is needed to assist the Committee in making its recommendation. The Committee will request assistance in forming an Advisory Group from the Director, EO Rulings & Agreements. If the Committee believes that continued involvement by the Advisory Group in dealing with a TAG issue is needed subsequent to the Committee having made its recommendation, the Committee will seek concurrence from the Director, EO Rulings & Agreements

    • Case Processing — The EO ATAT Committee will not recommend a formal suspense of case processing without obtaining concurrence from the Director, Rulings & Agreements.

    • Criminal Investigation — If a referral involves possible criminal activities, the TAG coordinator will be so notified, and the referral will be sent by the EO ATAT Program Manager to the FIU for assistance in preparing a criminal investigation referral.

4.75.35.4.3.1  (01-26-2007)
Exam Referral

  1. If appropriate, the Program Manager will send the referral to EO Examinations Classification with Form 5666 marked "EO ATAT" at the top. The referral will be sent by:

    • Mail:
      IRS EO Classification
      MC 4910 DAL
      Dallas, TX 75242

    • Facsimile:
      Attention: EO Classification
      (214) 413-5415

    • Email:
      Via Secure Messaging System
      anita.a.sutherland@irs.gov

4.75.35.5  (01-26-2007)
Specific Procedures — Financial Investigative Unit (FIU)

  1. Informal Requests

    • Requests by the FIU Coordinator for informal advice regarding potential referrals will be sent via email using secure messaging to the Program Manager, with a copy to the Assistant Program Manager and the Manager, EO Technical. The Program Manager will respond to the FIU Coordinator within five business days of receipt of the request for informal advice. A copy of the Program Manager’s responding email will be sent to all Committee members and the Manager, EO Technical.

4.75.35.5.1  (01-26-2007)
Forwarding a Referral to EO ATAT Committee

  1. FIU referrals are sent to Dallas Classification with a copy to the EO ATAT Committee as follows:

    • By mail:
      Exempt Organizations
      Internal Revenue Service
      Attention: EO ATAT Committee Program Manager
      SE:T:EO:RA:T:3, 3K4
      1111 Constitution Ave., NW
      Washington, DC 20224

    • By facsimile:
      Attention: EO ATAT Committee Program Manager
      (202) 283-8937

    • By email:
      Via Secure Messaging System
      To the Program Manager, EO ATAT Committee

4.75.35.5.2  (01-26-2007)
Steps

  1. Confirming Email — Upon receipt of the referral, the Program Manager will send a confirming email to the FIU Coordinator within three business days of receipt.

  2. Distribute Referral — The Program Manager will disseminate the referral to the Committee members within three business days of receipt. The Program Manager will place the referral on the agenda of the next EO ATAT Committee monthly meeting.

  3. Recommendation — The Committee will consider the referral and make a recommendation regarding how EO should proceed. The Program Manager or his/her Assistant will inform the FIU Coordinator within five business days of the meeting regarding the recommendation, with a copy to Dallas Classification or the TAG coordinator, as appropriate. The EO ATAT Committee may decide that an Advisory Group is needed.

4.75.35.5.3  (01-26-2007)
Fraud and ATAT Aspects

  1. Where a referral involves both a fraudulent transaction and an abusive tax avoidance transaction, the Committee members and the FIU representatives will meet to discuss the best course to handle the referral.

4.75.35.5.4  (01-26-2007)
ATAT?

  1. Not ATAT —

    • If the Committee decides the referral is not an ATAT, the Committee will send the referral (1) if an Exam case, back to Dallas Classification with a recommendation; or (2) if a TAG case, back to the TAG coordinator with a recommendation.

  2. ATAT — If the Committee decides the referral involves an ATAT, then —

    • Establish Advisory Group — Committee may decide that an Advisory Group is needed to assist the Committee in making its recommendation. The Committee will request assistance in forming an Advisory Group (1) if the referral is with Exam, from the Director, EO Exam; or (2) if the referral is with Determinations, from the Director, EO Rulings & Agreements. If the Committee believes that continued involvement by the Advisory Group in dealing with a FIU issue is needed subsequent to the Committee having made its recommendation, the Committee will seek concurrence from the Director, EO Exam, and/or the Director, EO Rulings & Agreements, as appropriate.

    • Case Processing — The EO ATAT Committee will not recommend a formal suspense of case processing without obtaining concurrence from the Director, EO Exam, or if an application, will not recommend a formal suspense of application processing without obtaining concurrence from the Director, EO Rulings & Agreements.

    • Criminal Investigation — If the referral involves possible criminal activities, the FIU Coordinator will be so notified, and the referral will then be handled by the FIU.

4.75.35.5.4.1  (01-26-2007)
Exam Referral

  1. If appropriate, the Program Manager will send the referral to EO Examinations Classification with Form 5666 marked "EO ATAT" at the top. The referral will be sent by:

    • Mail:
      IRS EO Classification
      MC 4910 DAL
      Dallas, TX 75242

    • Facsimile:
      Attention: EO Classification
      (214) 413-5415

    • Email:
      Via Secure Messaging System
      anita.a.sutherland@irs.gov

4.75.35.6  (01-26-2007)
Specific Procedures — Dallas Classification Unit

  1. Referrals received by the Dallas Classification Unit that have ATAT implications are sent by the Dallas Classification Unit via email, fax or regular mail to the:

    • Program Manager and

    • EO Exam Representative on the EO ATAT Committee


    The referral from Dallas will include a completed EO ATAT Tracking Sheet, available on the EO Intranet Website.

  2. If the referral is a case, the Dallas Classification Unit will continue processing the case since the EO ATAT Committee focuses solely on issues and policy aspects.

4.75.35.7  (01-26-2007)
Specific Procedures — Accelerated Case Building Unit (ACB) and Data Analysis Unit (DAU)

  1. Informal Requests

    • Requests by the ACB Coordinator for informal advice regarding potential referrals will be sent via email using secure messaging to the Program Manager, with a copy to the Assistant Program Manager and the Manager, EO Technical. The Program Manager will respond to the ACB Coordinator within five business days of receipt of the request for informal advice. A copy of the Program Manager’s responding email will be sent to all Committee members and the Manager, EO Technical.

4.75.35.7.1  (01-26-2007)
Forwarding a Referral to EO ATAT Committee

  1. ACB referrals are sent to Dallas Classification with a copy to the EO ATAT Committee as follows:

    • By mail:
      Exempt Organizations
      Internal Revenue Service
      Attention: EO ATAT Committee Program Manager
      SE:T:EO:RA:T:3, 3K4
      1111 Constitution Ave., NW
      Washington, DC 20224

    • By facsimile:
      Attention: EO ATAT Committee Program Manager
      (202) 283-8937

    • By email:
      Via Secure Messaging System
      To the Program Manager, EO ATAT Committee

4.75.35.7.2  (01-26-2007)
Steps

  1. Confirming Email — Upon receipt of the referral, the Program Manager will send a confirming email to the ACB Coordinator within three business days of receipt.

  2. Distribute Referral — The Program Manager will disseminate the referral to the Committee within three business days of receipt. The Program Manager will place the referral on the agenda of the next EO ATAT Committee monthly meeting.

  3. Recommendation — The Committee will consider the referral and make a recommendation regarding how EO should proceed. The Program Manager or his/her Assistant will inform the ACB Coordinator within five business days of the meeting regarding the recommendation, with a copy to Dallas Classification or the TAG coordinator, as appropriate. The EO ATAT Committee may decide that an Advisory Group is needed.

4.75.35.7.3  (01-26-2007)
ATAT?

  1. Not ATAT —

    • If the Committee decides the referral is not an ATAT, the Committee will send the referral (1) if an Exam case, back to Dallas Classification with a recommendation; or (2) if a TAG case, back to the TAG coordinator with a recommendation.

  2. ATAT — If the Committee decides the referral involves an ATAT, then:

    • Establish Advisory Group — Committee may decide that an Advisory Group is needed to assist the Committee in making its recommendation. The Committee will request assistance in forming an Advisory Group (1) if the referral is with Exam, from the Director, EO Exam, or (2) if the referral is with Determinations, from the Director, EO Rulings & Agreements. If the Committee believes that continued involvement by the Advisory Group in dealing with an ACB issue is needed subsequent to the Committee having made its recommendation, the Committee will seek concurrence from the Director, EO Exam and/or Director, EO, Rulings & Agreements.

    • Case Processing — The EO ATAT Committee will not recommend a formal suspense of case processing without obtaining concurrence from the Director, EO Exam, or if an application, will not recommend a formal suspense of application processing without obtaining concurrence from the Director, EO Rulings & Agreements.

    • Criminal Investigation — If the referral involves possible criminal activities, the ACB Coordinator will be so notified, and the referral will be sent to the FIU.

4.75.35.7.3.1  (01-26-2007)
Exam Referral

  1. If appropriate, the Program Manager will send the referral to EO Examinations Classification with Form 5666 marked "EO ATAT" at the top. The referral will be sent by:

    • Mail:
      IRS EO Classification
      MC 4910 DAL
      Dallas, TX 75242

    • Facsimile:
      Attention: EO Classification
      (214) 413-5415

    • Email:
      Via Secure Messaging System
      anita.a.sutherland@irs.gov

4.75.35.7.4  (01-26-2007)
Data Analysis Unit

  1. See procedures for the Accelerated Case Building Unit above.

4.75.35.8  (01-26-2007)
EO ATAT Criteria in Reviewing Referrals/Recommendations

  1. Information may be secured from many sources. In addition to reviewing the Tracking Sheet and any accompanying work papers, the EO ATAT Committee may contact the agent or manager directly regarding the case for additional information, as well as attorneys and representatives from all divisions to seek to understand all aspects of the potential abusive transaction. All agent/manager field requests for information should first be coordinated with the EO area manager. The types of information reviewed, if available, include, but are not limited to:

    • Balance sheets

    • Financial statements

    • Corporate minutes

4.75.35.8.1  (01-26-2007)
Documents to Review

  1. Balance Sheet

    • There are no particular account(s) that will specifically identify a tax shelter. However, changes in an account or a number of accounts may suggest some type of corporate activity that could be an indicator of an EO being used as a tax shelter. For example, if investments decreased in the ending balance sheet this could indicate a disposition of some kind.

  2. Financial Statements/Corporate Minutes

    • The activities of a corporation are not solely reflected in the accounting books and records. The financial statements provide a quick look and a narrative of the operations. These also may indicate if other related entities are involved and therefore initiate cross division issues.

4.75.35.8.2  (01-26-2007)
Committee Activity

  1. During this phase, the Committee will seek to determine —

    • The characteristics of the abusive transaction

    • The complexity of the abusive transaction and if there are any permutations that should be considered

    • The frequency of the potential abuse

    • The potential taxable consequences of the abuse

    • Whether this activity is a potential emerging abusive transaction issue

    • Whether this activity is continuing or likely to recur

4.75.35.8.3  (01-26-2007)
Analysis

  1. In this phase, the Committee will have extensive communication to expand its collective knowledge of the issue, its factual variations, and the applicable legal provisions. It will consider the resources that will be needed to address the potential abusive transaction in its recommendation as well as all other abusive transactions that the EO Executives are handling.

4.75.35.9  (01-26-2007)
Reports and Best Practices

  1. The EO ATAT Committee will seek to timely disseminate information on what is working, what is not working, and what is happening in the abusive tax avoidance transaction area. Such sharing of reports will be in the form of

    • Continual updates on the web regarding tax shelter information – what is going on, etc. (perhaps a segment devoted entirely to tax shelters).

    • Training of agents, establishing specific IDRs, audit guidelines, etc.

    • Disseminating memos, etc., from Directors regarding what is working, what to do, etc.

  2. The Program Manager will also discuss the sharing of best practices, etc., at the quarterly TEGE ATAT meetings so that there is coordination and information gathered from all TEGE operating divisions.

4.75.35.10  (01-26-2007)
Glossary

  1. Shown below is a glossary of key terms:

    Abusive Tax Avoidance Transaction/ Promotion (ATAT) A specific tax transaction/promotion that reduces tax liability by taking a tax position that is not supported by tax law or manipulates the law in a way that is not consistent with the intent of the law (tax evasion). Abusive tax avoidance transactions/promotions may be applicable to either a large number of taxpayers or a limited number of taxpayers. These strategies may be organized and marketed and, if so, are referred to as Abusive Tax Shelters. See IRM 4.32.1-1.
    Abusive Tax Shelter Specific tax transaction/scheme that "shelters" income from normal taxation by taking a tax position that is not supported by tax law or manipulates the law in a way that is not consistent with the intent of the law (tax evasion). The term Abusive Tax Shelter is commonly used to mean an abusive transaction/scheme that is highly technical and represents a strategy that is often marketed by an accounting or law firm. These transactions may sometimes be referred to as "abusive promotions." When IRS officially notifies taxpayers that a tax shelter is potentially abusive and therefore subject to disclosure requirements pursuant to Treasury Regulation § 1.6011-4, the abusive tax shelter is a listed transaction (see Listed Transaction for complete description). Not all abusive tax shelters are listed transactions.
    Abusive Tax Transaction / Scheme A specific tax transaction/scheme that reduces tax liability by taking a tax position that is not supported by tax law or manipulates the law in a way that is not consistent with the intent of the law (tax evasion). Abusive Tax Transactions / Schemes may be applicable to either a large number of taxpayers or a limited number of taxpayers. These strategies may be organized and marketed and, if so, are often referred to as an Abusive Tax Shelters.
    Accelerated Case Building (ACB) This EO Examination unit is designed to centralize and expedite more extensive development of cases as they are being prepared for assignment to the field. Cases are categorized by the extent of additional development required. The cases identified as requiring the most extensive research include fraud and ATATs.
    Advisory Group An informal group may be established by the EO ATAT Committee with the consent of the Director, EO Rulings & Agreements, to provide technical support to the Committee on a particular issue. It may include representatives from EO Rulings & Agreements, TE/GE Counsel and EO Examinations.
    Emerging Issue An issue, scheme, or devise uncovered through normal examinations, media coverage, or other sources that generally requires additional investigation to determine whether if it presents an abusive transaction.
    EO ATAT Committee The EO ATAT (Abusive Tax Avoidance Transaction) Committee serves as a forum to analyze potential abusive transaction referrals and to make recommendations concerning their disposition, coordinating, as appropriate, with other IRS divisions and functions. The Committee coordinates within the various functions of EO and, externally, with CC:TEGE, other IRS divisions, and other federal and state agencies. The Committee serves as the central point of contact within EO to monitor ATAT referrals and to make appropriate recommendations regarding them. The Committee screens, reviews, and tracks information on abusive transactions.
    EO ATAT Program Manager The EO ATAT Program Manager manages referrals for the Committee, including coordination, tracking, preparing reports, and scheduling meetings.
    Financial Investigative Unit (FIU) This EO Unit was established to address complex fraud and tax avoidance cases. The unit, staffed with revenue agents, forensic accountants, classifiers, reviewers, and data miners trained to effectively address complex fraud and abusive scheme issues, provides expert assistance and works in conjunction with the CI Division.
    Issue Management Team (IMT) The concept of IMT is to create high-powered, small teams that are integrated with Counsel, other operating divisions, and Appeals. The IMT will play a key role in creating alternative resolution strategies, monitoring field participant / promoter inventories, and coordinating with campus activities.
    Lead Development Center (LDC) Within SBSE, the LDC adresses abusive tax avoidance transactions that involve promoters.
    Office of Tax Shelter Analysis (OTSA) Within LMSB, the OTSA addresses abusive tax shelter transactions.
    Listed Transaction A transaction that IRS has officially notified taxpayers as potentially abusive and therefore subject to the disclosure requirements pursuant to Treasury Regulation § 1.6011-4. Organizers, sellers, and material advisors must maintain and furnish certain investor information under Treasury Regulation § 301.6112-1. Organizers, managers, and sellers (also referred to as "promoters" ) may be required to register certain listed transactions under Temp. Treasury Regulation § 301.6111-1T and Treasury Regulation § 301.6111-2. See also, IRC § 4965, which applies excise taxes and disclosure rules to certain potentially abusive tax shelter transactions.
    SAT/ESC The Servicewide Abusive Transaction (SAT) Executive Steering Committee (ESC) is the executive group chartered to serve as a forum to develop cross-divisional IRS strategies for dealing with abusive tax transactions/schemes both internally and externally. The SAT/ESC coordinates enforcement activities and resource issues to ensure a Service-wide perspective in combating abusive tax transactions/schemes.
    Tax Shelter A tax strategy/scheme that "shelters" income from normal taxation. Depending on the facts and legal analysis, a specific transaction/scheme may represent either lawful tax avoidance or unlawful tax evasion. Those tax shelters resulting in tax evasion are known as Abusive Tax Shelters. The term "Tax Shelter" is sometimes used to mean "Abusive Tax Shelter" in common parlance.
    Touch-and-Go Procedures (TAG) TAG is a program designed to identify cases handled by Exempt Organizations Determinations specialists early in the process that may involve an abusive tax avoidance transaction. A TAG case may also involve a potential fraud or terrorist matter. See IRM 7.20.6.

Exhibit 4.75.35-1  (01-26-2007)
ATAT Process Flowchart

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