Appeals Settlement Guidelines (ASG)

An Appeals Coordinated Issue is an issue with IRS-wide impact or importance, requiring coordination to ensure uniformity and consistency nationwide. Appeals’ Technical Guidance Coordinators (TGCs) serve as the focal point for activities involving these issues by providing advice, guidance, and assistance to other Appeals employees in resolving taxpayer disputes. In some instances, Appeals Settlement Guidelines are prepared and represent Appeals’ position regarding the potential hazards of litigation for proper resolution of an Appeals Coordinated Issue by providing guidance to ensure consistent treatment of the issue. A list of published ASGs can be found below.

NOTE: Coordinators may have changed since settlement guidelines were published. Please refer to the Technical Guidance - International Index (PDF) for the latest coordinator contact information.

Abusive Tax Avoidance Transactions

• Business Directory for Visually impaired
• Deductions for Contributions to 401(k) or Defined Contribution Plans during Grace Period, Related Change of Accounting Adjustments, and Penalties;
• Domestic Abusive Trust Schemes
• Home Based Business Promotions
• IRC Section 302/318 Basis Shifting Transactions
• IRC Section 351/Contingent Liability
• IRC Section 44 Disabled Access Credit Tax Avoidance Schemes
• Intermediary Transaction Tax Shelters and Penalties
• Internet Shopping Portal
• Lease in, lease out (LILO)
• Notice 2000-15 Abusive Charitable Remainder Trusts
• Notice 2000-44 Transactions - Described as generating losses resulting from artificially inflating the basis of partnership interests
• Notice 2002-21 Transaction involving the use of a Loan Assumption agreement to claim an inflated basis in assets acquired from another party
• Notice 2002-35 Involves the use of a National Principal Contract to claim current deductions for periodic payments while disregarding the accrual of a right to receive offsetting payments in the future
• Notice 2002-50 Transactions involving the use of a straddle, a tiered partnership structure, a transitory partner, and the absence of a sec 454 election to claim a permanent noneconomic loss
• Notice 2002-65 Pass-through Entity Straddle Tax Shelter Transactions and Penalties
• Notice 2003-47 Transfers of Compensatory Stock Options to Related Persons
• Notice 2003-22 Certain arrangements involving employee leasing companies that have been used to avoid or evade federal income and employment taxes.
• Notice 2003-35 Tax Exempt Small Insurance Company Transactions
  under 501(c)(15) and related penalties
• Notice 2003-77 IRC 461(f) Contested Liabilities Transactions
• Preparer/Promoter Penalties
• Sale in, lease out (SILO)
• Telecommunication System for Hearing Impaired

Air Transportation

• Federal Income Tax Withholding on Compensation Paid to Nonresident Alien Crew by a Foreign Transportation Entity

Cafeteria Plans

• Heath Insurance Deductibility for Self-employed Individuals

COLI (Corporate Owned Life Insurance)

Commercial Banking

• Accrual of interest on non-performing loans (see Banking - Savings and Loan)
• Foreign Withholding Taxes (Cross Border Loans)
• Interchange Merchant Discount Fee

Construction/Real Estate

• Claim Revenue Under a Long-term Contract

Employment Tax

• Medical Resident FICA Refund Claims

Environmental

• IRC 1341 Environmental Remediation Costs

Excise Tax

• Virtual Private Networks

Food Industry

• Charitable Contributions of Surplus Food
• Package Design Cost

Forest Products

• Losses of Timber form Southern Pine Beetle
• Logging Truck Roads

Fuel from a Nonconventional Source (FNS)

• Methane Gas Project (IRC § 29 Credit), Credit for FNS

Gaming

• The Applicable Recovery Period Under IRC 168(a) for Slot Machines, Video Lottery Terminals and Gaming Furniture, Fixtures and Equipment
• Class Life of Floating Gaming Facilities

I.R.C. § 118 SALT

• State and Local Location Tax Incentives (I.R.C. § 118 SALT)
• Exclusion of Income: Non-Corporate Entities and Contributions to Capital, I.R.C. § 118

Insurance – Life

• IRC 807 Basis Adjustment – Change in Basis vs. Correction of Error
• Loss Utilization in a Life-nonlife Consolidated Return Separate v. Single Entity Approach

Intangibles

• Amortization of Employment Contracts
• Covenants Not to Compete

Interest Computations

• Net Rate Interest Netting - Requirement that Both Statutes be Open for Pre-98 Act Years
• Overpaid Estimated Taxes

International

• Foreign Sales Corporations (FSC) Advance Payment Transactions

Inventory

• Dollar Value LIFO: Segments of Inventory
• Dollar Value LIFO: Bargain Purchase Inventory
• Dollar-value LIFO: Earliest Acquisition Method

Leasing Promotions

• Lease Stripping Transactions
• Losses Reported from Inflated Basis Assets from Lease Stripping Transactions
• Intermediary Transactions Tax Shelters

Mare Leasing

Primary issue of whether expenses were incurred in carrying on a trade or business. Alternatively, whether individuals were materially participating and at risk; whether expenses were ordinary and necessary; and whether expenses should be capitalized or currently deducted.

Maquiladora

• IRC Section 1504(d) Election
• IRC Section 168(g)

Media/Communications

• Investment Tax Credit - Transition Property

Military

• Military Disability Retirement Benefits

Mining

• Strike Costs
• Excess Moisture
• Receding Face Deduction
• The Effect of Costs Incurred During a Strike on the Percentage of Depletion Computation

Motor Vehicle

• New Qualified Plug-in Electric Drive
• Dollar-Value LIFO - Definition of an Item
• Remanufacturers' Inventory of Cores
• Excess Parts Inventory

Notional Principal Contracts

• Notional Principal Contracts (Contingent Deferred Swaps)

Partnerships

• Subchapter K Anti-abuse Regulation 1.701-2

Petroleum

• Capitalization of Delay Rentals
• Cost Depletion Recoverable Reserves
• North Sea IDC Transition Rule

Pharmaceutical

• Medicaid Rebates
• Research and Experimentation Expenditures (Reg. 1.861-17(a)(4)

Research Credit

• Extraordinary Expenditures for Utilities
• R&E Credit - Self-Constructed Supplies
• Qualifying Wages Under Section 41 in Determining the Tax Credit or Increasing Research Activities
• Wages of Technical Writers and the Research Credit  

Retail

• ACRS and ITC for Suspended Ceilings
• Contributions to 401(k) Plans Attributable to Compensation Paid After Year End Under 401(a)(6);
• Tenant's Rent Leveling IRC 467 Lease Agreements
• Valuation of an Acquired Retailer's Inventory

S Corporations

• Shifting of Income to Tax Exempt Organization (SC2)

Savings and Loans

• Supervisory Goodwill
• Accrual of Interest on Non Performing Loans (see Banking)
• Validity of Regulations Sec. 1.593-6A(b)(5)(vi)
• Supervisory Goodwill

Securities & Financial Services

• Transfer or Sale of Compensatory Options or Restricted Stock to Related Persons- Notice 2003-47

Shipping

• Federal Income Tax Witholding on Conpensation Paid to Nonresident Alien Crew by a Foreign Transportation Entity (See Air Transportation)
• Income Tax Withholding on Wages Paid to U.S. Crew

Sports Franchises

• Media Rights Acquired in Connection with a Sports Franchise

State Refundable Credits

• New York State, Qualified Empire Zone, Enterprise Credit, Real Property Taxes

Telecommunications

• Taxation of Universal Service Fees

Utilities

• Investment Credit Transition Property
• Membership Payments Made to Industry-created Research Organizations