Part 4. Examining Process
Chapter 4. AIMS Procedures and Processing Instructions
Section 18. Large Dollar Cases
This chapter covers unique processing instructions for large dollar cases. In determining whether a case should be considered a large dollar case, treat each tax period separately.
See IRM 184.108.40.206.
Large dollar cases are:
Agreed and unpaid deficiencies of $100,000 and greater. See IRM 220.127.116.11.
Overassessment Cases of $100,000 or more. See IRM 18.104.22.168.
Over $10 Million in Deficiency. See IRM 22.214.171.124.
Joint Committee Cases. See IRM 126.96.36.199.
All large dollar cases with agreed and unpaid deficiencies or overassessments of $100,000 and greater must be flagged on Form 3198 Form 3198, Special Handling Notice for Examination Case Processing, in the "Expedite Processing" section. In addition the "Over $100,000 Agreed and Unpaid" section of Form 3198 must be completed by the field group. Requirements for Centralized Case Processing (CCP) and Technical Services to complete this section have been removed. The next revision of Form 3198 will reflect the changes above.
This section pertains to income, estate, gift and certain excise taxes with agreed and unpaid deficiencies of $100,000 and greater that are subject to the interest-free waiver period under IRC 6601. These procedures do not apply to employment tax returns or delinquent returns secured by Examination after a Substitute for Return has posted.
The "Expedite Processing" section of the Form 3198 must be completed by the field group for all case files with agreed unpaid deficiencies or overassessments of $100,000 and greater. The $100,000 criteria is not cumulative, but is determined per year.
Due to interest paid on the deficiency or overassessment, these cases must receive expedite processing. Every effort should be made to assess the deficiency within 30 calendar days of the agreement date if the unpaid deficiency is greater than $100,000. In addition, a quick assessment will be necessary ONLY if the 23C date will not be within 30 calendar days from the agreement date. See IRM 4.4.25, Quick Assessments.
Every effort should be made to forward these cases as expeditiously as possible. The following time frames have been established and should be followed:
The group has 4 calendar days after receipt of the waiver to forward the case for processing.
Technical Services has 8 calendar days to review the case if it was forwarded to them.
Centralized Case Processing has 9 calendar days to input the case for closure if the case has been through Technical Services. If the case did not go through Technical Services, CCP has 17 calendar days.
The quick assessment guidelines found in IRM 4.4.25 , Quick Assessments, will be revised as follows for agreed, unpaid deficiencies for income, estate, gift and certain excise taxes:
Less than $99,999 - Quick assessment not required.
$100,000 and greater - A quick assessment is necessary if the 23C date will not be within 30 days of the agreement date.
Regardless of the dollar amount, quick assessments are not required on civil penalty assessments because they do not fit the criteria for agreed, unpaid deficiencies. However, a quick assessment would be required if the civil penalty had an imminent statute date of less than 60 days.
Overassessments of $100,000 or more must receive expedite processing. See IRM 188.8.131.52.
Overassessments of $100,000 or more in Correspondence Exam groups in the Campus must be approved by the lead tax examiner or manager and processed within 21 days of receipt.
Overassessments of ten million dollars or more (including allowable interest) will be refunded using manual refund procedures. See IRM 4.4.19, Manual Refunds.
Each year the General Accounting Office (GAO) examines the Service’s financial statements. As a part of this audit, they review documentation for taxpayers whose balance due (including interest and penalties) is over $10 million.
For each tax period, where the Balance Due (this includes interest and penalties) is $10 million or more, a copy of the following forms must be sent by CCP to the Office of Unpaid Assessment Analysis after the case has been closed.
Form 4318, Examination Workpapers Index
Form 4700, Examination Workpapers
Form 4549, Income Tax Examination Changes
The address is:
Office of Unpaid Assessment Analysis
333 W. Pershing Rd.
Mail Stop S-2 1035
Kansas City, MO 64108-4302
All Joint Committee closed cases from Large and Mid-Size Business (LMSB) and Small Business/Self-Employed (SBSE) will be sent to the Joint Committee Program in Chicago. When closing agreed, no-change, and surveyed Joint Committee cases, Examination Returns Control System (ERCS) should be updated to Status 21, In-transit to Technical Services, with the Technical Services Code (TSC) 901. All Report Generation Software (RGS) records should be archived. See the LMSB Joint Committee home page for address and additional information: http://lmsb.irs.gov/hq/pqa/4/home.asp
If a survey of a Joint Committee case based on the taxpayer’s retained copy is requested, Centralized Case Processing will use an original return blocking series, prepare Form 2275, and forward it to the appropriate campus in the source document file the same day the closing was input. The Files Unit at the campus will enter the new DLN on the Form 2275 and refile the original return under the new DLN.