This section provides instruction to EG WSD for the classification of Form 706 and Form 709 returns, delivery of classified inventory to EG Exam, and ancillary matters for returns not delivered to EG Exam for audit.

Statutory Authority:

Policy Statement 4-21, Selection of Returns for Examination, states that the primary objective in selecting returns for examination is to promote the highest degree of voluntary compliance on the part of the taxpayers. This requires the exercise of professional judgment in selecting sufficient returns of all classes of returns in order to assure all taxpayers of equitable consideration, in utilizing available experience and statistics, indicating the probability of substantial error, and in making the most efficient use of examination staffing and other resources.

IRM 1.11.1.6.5, General Management Responsibilities, provides that all IRS managers must ensure that their employees have access to internal management documents defining policies and procedures necessary to perform their jobs. IRS managers who are responsible for establishing the program, policy, process and procedures necessary to implement and manage a program area for the IRS are program owners. They are responsible for:

IRM 1.11.2.2.1, Supplemental Guidance, provides that organizations may issue supplemental guidance and local procedures to employees when the primary guidance is in the IRM. Supplemental guidance contains information that details how to perform or review a task. Supplemental guidance must comply with published guidance and not supersede the IRM.

The Director, Exam Case Selection is responsible for oversight of EG WSD.

The Employment Tax and Estate & Gift Tax Exam Case Selection Program Manager (Program Manager) is responsible for oversight of EG WSD operations.

The EG WSD Group Manager is responsible for the oversight of the EG WSD group.

To accomplish the mission of Exam Case Selection, EG WSD will:

All information management systems that are utilized have safeguard measures in place that address all key components of information technology (IT) security requirements to restrict access to sensitive data.

By the 15th of each month, CMC manager(s) will review 10% of classification efforts and survey decisions for the prior month of their employee cadre to ensure classification decisions adhere to EG WSD case selection policy. The review will be documented in a memorandum or feedback form, that will be maintained in digital format on the EG WSD shared drive.

The EG WSD Group Manager (or designee) will conduct quarterly reviews of the CMC manager reviews completed pursuant to paragraph (2) of this subsection to ensure such reviews adhere to EG WSD case selection policy. These reviews by the EG WSD Group Manager (or designee) will be documented in a memorandum.

The EG WSD Group Manager (or designee) will also conduct a 10% quarterly review of classification efforts. This includes classification completed in CMC and classification completed by EG WSD Coordinators; see IRM 4.25.3.5.1, CMC Classification of Filed Estate and Gift Tax Returns. These reviews by the EG WSD Group Manager (or designee) will be documented in a memorandum provided to the CMC managers and/or EG WSD coordinators.

The Program Manager (or designee) oversees the reviews in paragraphs (2), (3), and (4) of this subsection to ensure these reviews adhere to the examination case selection policy.

Program Reports: information regarding inventory levels and program workplan progress are included on, but not limited to, the following reports:

Monthly Briefings:

Below are acronyms and definitions for terms frequently used throughout this IRM:

For general guidance, procedures, tax law, and regulations on a wide variety of estate and gift tax issues, refer to the Estate and Gift Tax Knowledge Base SharePoint.

Refer to IRC 7803 and the Taxpayer Bill of Rights (TBOR) for information about how IRS employees are expected to carry out their duties with integrity and fairness. The IRS must administer the law with integrity and fairness to all taxpayers. Under TBOR, IRS employees must exercise professional judgment in conducting enforcement activities.

EG WSD employees have the ongoing responsibility to ensure that all taxpayer rights are protected and observed, whether these rights are mandated by statute or provided as a matter of policy. For more information refer to IRM 4.10.1.2, Taxpayer Rights.

Employees should review the Taxpayer Bill of Rights (TBOR).

Workplan monitoring includes reviewing the number of returns started by EG Exam each month, the number of returns closed by EG Exam each month, and the number of returns in process with EG Exam to maintain optimal exam status code 10 inventory.

The EG WSD Group Manager is required to review the reports in IRM 4.25.3.1.6, Program Reports and Monthly Briefings, for workplan and inventory monitoring purposes.

The EG WSD Group Manager is responsible for delivery of sufficient exam status code 10 inventory to EG Exam.

The EG WSD Group Manager and EG WSD National Gatekeeper are responsible for ensuring sufficient wall inventory as follows:

At least annually, the EG WSD Group Manager, EG WSD Coordinators, and EG WSD National Gatekeeper will conduct a review of business results as compared to the EG WSD prioritization of cases sent to EG Exam and make recommendations to changes to case prioritization based on this review. This review must be documented in a memorandum to the Program Manager. Changes to the prioritization must be approved in writing by the Program Manager prior to implementation.

At least annually, the EG WSD Group Manager must review the current screening criteria for Form 706 and Form 709 returns. This review must be documented in a memorandum to the Program Manager. Changes to the prioritization must be approved in writing by the Program Manager before implementation. Any changes to the current screening filters may require coordination with Taxpayer Services, Submission Processing, and Research Applied Analytics and Statistics (RAAS).

The EG WSD Group Manager is responsible for reviewing weekly an ERCS inventory report of all assessment statute expiration dates (ASED) within EG WSD employee group codes (EGC).

LWIS / ERCS exam status code 08 inventory:

CMC / ERCS exam status code 06 inventory:

Monthly, the EG WSD Group Manager and EG WSD Compliance Clerk will receive a 4.1 Table report for EG WSD EGC’s from the AIMS/ERCS Program Analyst. See IRM 4.4.27.5.1, Table 4.0 and 4.1 - Statute Control Reports, for information regarding 4.1 Table reports.

CMC Classifier: the CMC classifier is responsible for classifying returns in CMC. Prior to beginning of the fiscal year, the EG WSD Group Manager will determine the resources needed for CMC classification and work with EG Exam to secure resources for classification; see IRM 4.25.3.3.1, Workplan and Inventory Monitoring. Selection of the CMC classification cadre and the length of the classification detail is determined by EG Exam, with input by EG WSD. The Form 706 and Form 709 returns meeting EG WSD screening criteria are classified by EG Exam employees. The Form 706-NA, United States Estate (and Generation-Skipping Transfer) Tax Return, and Form 709-NA, United States Gift (and Generation-Skipping Transfer) Tax Return, are classified by Cincinnati Centralized EG Campus Operations.

CMC Manager: the CMC managers are the EG WSD National Gatekeeper and Coordinators on the EG WSD staff. CMC managers are responsible for the following tasks as it pertains to their classification cadre:

EG WSD Compliance Clerk: the EG WSD Compliance Clerk is available to provide additional research to CMC classifiers as follows:

Each CMC classifier will be assigned a CMC manager. It is the responsibility of the CMC manager to provide monthly assignments as directed by the EG WSD Group Manager; see IRM 4.25.3.4.3, CMC Classification Assignments.

Training of newly selected CMC classifiers will be conducted by EG WSD at least two weeks prior to the start of the classification detail. The training will include:

Estate tax returns (i.e., Form 706 and Form 706-NA ) and gift tax returns (i.e., Form 709 and Form 709-NA) that meet EG WSD screening criteria are scanned in Kansas City by RAAS on a continuous basis. Scanned returns are uploaded to the Document Image Network (DIN), converted to PDF, and uploaded to LIN.

By the 15th day of the month, the EG WSD Group Manager and EG WSD Examination Analyst will determine which returns available in LIN should be loaded into CMC for classification based on the following priorities:

After the review in paragraph (2) of this subsection is complete, if there are estate tax returns that will not be considered for classification by EG WSD, the EG WSD Examination Analyst will review those returns for Part 3 elections (i.e., IRC 2032A, IRC 6166 or IRC 6163 election) by reviewing the DLN blocking series; see IRM 3.10.73.8.2, DLN Assignment for BMF. Follow procedures in IRM 4.25.3.5.4, Classification of IRC 2032A Elections, for accepted as filed returns with an IRC 2032A election and IRM 4.25.3.5.5, Classification of IRC 6166 Elections, for accepted as filed returns with a IRC 6166 election.

For estate tax returns to be placed into CMC, the EG WSD Examination Analyst will:

For gift tax returns to be placed into CMC, the EG WSD Examination Analyst will provide the return listing to the EG WSD Compliance Clerk to create an AIMS base for the returns and establish them in exam status code 06, EGC 1087 using the database tool. The EG WSD Compliance Clerk will complete this task within one week and monitor the returns until they have an established AIMS base. Once the returns have an established AIMS base, the EG WSD Examination Analyst will follow the steps (b) through (d) in paragraph (4).

The EG WSD Group Manager will use the completed spreadsheet in paragraph (4)(d) to assign returns to CMC managers. For gift tax returns, the EG WSD Group Manager should first sort the list by address before making assignments. Each CMC manager assignment should be on a separate tab. The completed assignment spreadsheet will be stored on the EG WSD shared drive.

The EG WSD Group Manager will send the assignment spreadsheet from paragraph (6) of this section to the LB&I CMC analyst indicating that the CMC strat file should be created for the returns listed on the spreadsheet and that the returns should be place in "Ready for Assignment" status on CMC. The EG WSD Group Manager will notify and instruct the CMC managers of the classification assignment for the upcoming month.

Prior to the first of the month, the CMC managers will assign returns to their CMC classifiers consistent with EG WSD Group Manager’s instructions and notify the classifiers via email of the classification assignment and due date. Guidance on CMC return assignments can be found in the EG WSD CMC Manager/LWIS Delivery Desk Guide; see IRM 4.25.3.6.1, CMC Manager Review and Approval of Classified Returns, for information on this desk guide.

It is the continuing responsibility of the CMC manager to ensure that CMC classifiers have sufficient inventory of returns to classify. This responsibility requires timely assignment of returns for the monthly classification assignment and reviewing the Weekly CMC Report to monitor the current status of classifier inventories; see IRM 4.25.3.1.6, Program Reports and Monthly Briefings, for information on the Weekly CMC Report.

If a CMC classifier completes their assignments prior to the end of the month, the CMC manager should coordinate with the EG WSD Examination Analyst and EG WSD Group Manager to secure additional inventory for the classifier as needed. The EG WSD Examination Analyst and EG WSD Group Manager will follow the procedures in paragraph (2) to determine which returns to place into CMC and the procedures in paragraphs (3) through (7) to have those returns sent to CMC for classification.

CMC classifiers, under the direction of EG WSD, are responsible for determining if a case should be selected for audit or not selected for audit.

All CMC classifiers have access to the following desk guides located in the Estate and Gift sub-industry folder of the CMC main page:

It is the responsibility of CMC classifiers to read and be familiar with the information found in the desk guides located in the Estate and Gift sub-industry folder of the CMC main page.

CMC classifiers access their assigned return inventory in CMC. Procedures for accessing assigned inventory can be found in the LB&I CMC User Guide. Classifiers experiencing issues in CMC should contact their CMC manager for assistance.

Each assigned return in CMC will include a LIN link to view a scanned image of the return. If an assigned return does not include a LIN link, the CMC classifier will email the CMC manager for assistance. The CMC manager will work with the EG WSD Group Manager and the LB&I CMC Analyst to obtain the LIN link in CMC. Classifier guidance for specific issues with the return image in the LIN link can be found in the EG WSD Classification Guide. LIN access issues should be addressed to *LB&I PSP LIN and/or the LIN SharePoint.

CMC classifiers are required to review all return schedules to identify up to three significant tax and compliance issues. Before accepting a return as filed, the classifier should review the return for frequently missed issues, limited-scope issues, and training issues (when applicable).

The CMC classifier will document the classification decision for selected returns in the following manner:

The CMC classifier will document the classification decision for accepted-as-filed returns in the following manner:

After documenting the classification decision, the CMC classifier will:

If a CMC classifier is accepting as filed an estate tax return with administration fees to any private executor over a threshold as provided in the EG WSD Classification Guide, the classifier will take the additional steps:

The EG WSD Compliance Clerk will submit the completed Form 5346 to the EG WSD Group Manager for signature and forward via secure email to the appropriate contact as outlined in the EG WSD CMC Manager/LWIS Delivery Desk Guide.

If the CMC classifier determines that the return requires perfection, follow procedures under IRM 4.25.3.5.2, Perfection.

If the CMC classifier determines that the return requires stock valuation, follow procedures under IRM 4.25.3.5.3, Valuation of Listed and Over-the-Counter Securities.

All returns classified at classification are subject to the review requirements in IRM 4.25.3.1.5, Program Controls.

Perfection is the process of obtaining missing documents required to be filed with the return that are needed to make a classification decision. Perfection is completed by the Cincinnati Centralized EG Campus Operation; see IRM 4.25.2.9.2.1, Perfection. Examples of required documents may include: a copy of the death certificate, a decedent’s will and/or trust, return schedules, or appraisals.).

If the return is missing a required document and the CMC classifier finds an audit issue, the return should be selected as discussed in IRM 4.25.3.5.1, CMC Classification of Filed Estate and Gift Tax Returns. The classifier should note the perfection documents needed in the Recommended Treatment Stream Rationale box.

If the CMC classifier is unable to determine whether an examination issue exists without the missing documents, the classifier will take the following actions to request perfection for the return:

The EG WSD Compliance Clerk monitors the EG WSD perfection mail box weekly and will perform the following steps:

The Cincinnati Centralized EG Campus Operation will complete perfection requests consistent with IRM 4.25.2.9.2.1, Perfection. Completed perfection requests are routed back to the EG WSD perfection mailbox. The EG WSD Compliance Clerk then takes the following steps:

The CMC classifier will upload a copy of the perfection documents to the taxpayer folder and synchronize them to the CBF.

It is the responsibility of CMC managers to monitor the perfection requests of their CMC classifiers. If a classifier has not received a response on perfection request six weeks after making the request, the CMC manager will follow up with the EG WSD Compliance Clerk for a status of the perfection request.

Requests to verify the valuation of listed and over-the-counter securities as part of the estate and gift tax return classification process are routed to the Cincinnati Centralized EG Campus Operation; see IRM 4.25.2.9.2.2, Stock Valuations, for the Cincinnati Centralized EG Campus Operation stock valuation procedures.

CMC classifiers will determine whether a return needs stock and/or bond valuation assistance based on the guidelines provided in the EG WSD Classification Guide. This guide includes examples of when it is appropriate for the classifier to conduct research on the valuation of listed and over-the-counter securities instead of making a stock valuation request to the Cincinnati Centralized EG Campus Operation.

If the return requires stock and/or bond valuation assistance and the CMC classifier finds an additional audit issue, the return should be selected as discussed in IRM 4.25.3.5.1, CMC Classification of Filed Estate and Gift Tax Returns. The classifier should also select and notate the stock valuation issue as a second issue.

If the only potential issue is the valuation of listed and over-the-counter securities requiring the Cincinnati Centralized EG Campus Operation assistance, the CMC classifier will take the following actions to request stock valuation for the return:

The EG WSD Compliance Clerk monitors the EG WSD stock valuation mail box weekly and will perform the following steps:

The Cincinnati Centralized EG Campus Operation will complete stock valuation requests consistent with IRM 4.25.2.9.2.2, Stock Valuations. Completed stock valuation requests are routed back to the EG WSD stock valuation mailbox. The EG WSD Compliance Clerk then takes the following steps for completed stock valuation requests received from the Cincinnati Centralized EG Campus Operation:

The CMC classifier will upload a copy of the stock valuation documentation received from the Cincinnati Centralized EG Campus Operation to the taxpayer folder and complete the classification of the return consistent with IRM 4.25.3.5.1, CMC Classification of Filed Estate and Gift Tax Returns, and synchronize the stock valuation documentation uploaded to the taxpayer folder to the CBF.

It is the responsibility of CMC managers to monitor the stock valuation requests of their CMC classifiers. If a classifier has not received a response on a stock valuation request six weeks after making the request, the CMC manager will follow up with the EG WSD Compliance Clerk for a status of the stock valuation request.

To make a qualified IRC 2032A election, the decedent must have been a United States citizen or resident at the time of death, and a completed Schedule T and lien agreement, with all necessary signatures, must be attached to the Form 706. Additionally, the 50-percent and 25-percent liquidity tests of IRC 2032A(b) must be met.

During classification, the CMC classifier will consider whether the initial eligibility requirements to make the IRC 2032A election have been met.

If the CMC classifier determines that the IRC 2032A initial eligibility requirements are not met, or cannot make this determination without taxpayer contact, then the classifier will select the return for the IRC 2032A issue consistent with IRM 4.25.3.5.1, CMC Classification of Filed Estate and Gift Tax Returns. The classifier will select the UIL code, SAIN code, and risk assessment for the IRC 2032A issue consistent with the procedures in the EG WSD Classification Guide.

If the CMC classifier determines that the IRC 2032A initial eligibility requirements are met and there are no other classification issues identified on the return, then the return may be accepted as filed following the procedures in IRM 4.25.3.5.1, CMC Classification of Filed Estate and Gift Tax Returns. The classifier will select the UIL code, SAIN code, and risk assessment for the IRC 2032A issue consistent with the procedures in the EG WSD Classification Guide.

Weekly, the EG WSD National Gatekeeper will review the Weekly CMC Report to find accepted as filed Form 706 returns that have an IRC 2032A election. All accepted as filed Form 706 returns with an IRC 2032A election will be sent via secure email on a spreadsheet listing to *SBSE EEF E&G Campus Classification for processing of the lien package, as outlined in IRM 4.25.2.8.7, Lien Packages to Advisory. The spreadsheet listing should include:

Prior to classification, the Cincinnati Centralized EG Campus Operation reviews all Form 706 returns disclosing an election under IRC 6166 as described in IRM 4.25.2.8.3, IRC 6166 Installments. The Cincinnati Centralized EG Campus Operation sends a Letter 2568-C to provide notice that the election was tentatively granted pending review by an EG Exam group. See IRM 4.25.2.8.3.7, Case Establishment.

Generally, an estate qualifies for an IRC 6166 election if :

In certain cases there may be additional eligibility requirements; see IRC 6166 (b) through (h).

During classification, the CMC classifier will consider whether the initial eligibility requirements to make the IRC 6166 election have been met.

If the CMC classifier determines that the IRC 6166 initial eligibility requirements are not met, or cannot make this determination without taxpayer contact, then the classifier will select the return for the IRC 6166 issue consistent with IRM 4.25.3.5.1, CMC Classification of Filed Estate and Gift Tax Returns. The classifier will select the UIL code, SAIN code, and risk assessment for the IRC 6166 issue consistent with the procedures in the EG WSD Classification Guide.

If the CMC classifier determines that the IRC 6166 initial eligibility requirements are met and there are no other classification issues on the return, then the return may be accepted as filed following the procedures in IRM 4.25.3.5.1, CMC Classification of Filed Estate and Gift Tax Returns. The classifier will select the UIL code, SAIN code, and risk assessment for the IRC 6166 issue consistent with the procedures in the EG WSD Classification Guide.

Weekly, the EG WSD National Gatekeeper will review the Weekly CMC Report to find accepted as filed Form 706 returns that have an IRC 6166 election. All accepted as filed Form 706 returns with an IRC 6166 election will be sent via secure email on a spreadsheet listing to *SBSE Estate & Gift 6166 for processing of the lien package, as outlined in IRM 4.25.2.8.7, Lien Packages to Advisory. The spreadsheet listing should include:

Taxpayers may seek an extension of time to pay estate tax under IRC 6163 attributable to a reversionary or remainder interest included under Chapter 11 in the value of the gross estate. A taxpayer requests the extension by filing a Form 4768, Application for Extension of Time to File a Return and/or Pay U.S. Estate (and Generation-Skipping Transfer) Taxes, and indicates the election on Part 3, question 4 of the Form 706 return. Tax returns indicating an IRC 6163 election are routed to Cincinnati Centralized EG Campus Operation for monitoring and transferred to WSD National Gatekeeper for review; see IRM 3.11.106.18.8, Deferment of Payment (Extension of Time to Pay) - Form 706, for Submission Processing procedures and IRM 4.25.2.8.2.6, Estate Tax Extension of Time to Pay Under IRC 6163, for Cincinnati Centralized EG Campus Operation procedures.

The EG WSD National Gatekeeper serves as the subject matter expert (SME) and reviews any IRC 6163 elections routed to EG WSD.

The EG WSD National Gatekeeper will review the election for validity and provide a response to the Cincinnati Centralized EG Campus Operation within five (5) business days of receiving the request.

The general rule regarding the marital deduction under IRC 2056 is that no deduction is allowed for property passing to a non-U.S. citizen spouse who does not become a citizen of the United States before the estate tax return is filed.

There is an exception to this general rule, allowing a marital deduction on property passing to a Qualified Domestic Trust (QDOT) under IRC 2056A. The estate tax on property transferred to a QDOT is deferred until any of the following:

The basic requirements for a QDOT election can be found in IRC 2056A, Qualified Domestic Trust.

During classification, the CMC classifier will consider whether the requirements to make the 2056A election have been met.

If the CMC classifier determines that the 2056A requirements are not met, or cannot make this determination without taxpayer contact, then the classifier will select the return for the 2056A issue consistent with IRM 4.25.3.5.1, CMC Classification of Filed Estate and Gift Tax Returns. The classifier will select the UIL code, SAIN code, and risk assessment for the 2056A issue consistent with the procedures in the EG WSD Classification Guide.

If the CMC classifier determines that the 2056A initial eligibility requirements are met and there are no other classification issues on the return, then the return may be accepted as filed following the procedures in IRM 4.25.3.5.1, CMC Classification of Filed Estate and Gift Tax Returns. The classifier will select the UIL code, SAIN code, and risk assessment for the IRC 2056A issue consistent with the procedures in the EG WSD Classification Guide.

Weekly, the EG WSD National Gatekeeper will review the Weekly CMC Report to find accepted as filed Form 706 returns that have an 2056A election. All accepted as filed Forms 706 with a 2056A election will be sent via secure email on a spreadsheet listing to *SBSE EEF E&G Campus Classification for processing of the lien package, as outlined in IRM 4.25.2.8.7, Lien Packages to Advisory. The spreadsheet listing should include:

Once a CMC classifier completes the classification of a return in CMC, the classification effort is automatically routed to the CMC manager for review and approval in CMC. The CMC manager is required to approve the classification decision in CMC. Once approved, the return will be made available for delivery to EG Exam or accepted as filed.

The steps for reviewing and approving classification efforts in CMC can be found in the CMC Manager/LWIS Delivery Desk Guide. The CMC Manager/LWIS Delivery Desk Guide provides all the EG WSD CMC manager procedures of working within CMC, as well as the EG WSD National Gatekeeper procedures for delivery in LWIS, and the EG WSD Compliance Clerks responsibilities related to CMC Classification.

If the CMC manager notices that the CMC classifier missed any required step in the classification process, then the CMC manager will disapprove the classification effort and notate the reason for disapproval in the "Manager Risk Notes" tab of CMC. Disapproving the classification effort will automatically route the return back to the classifier for action; see IRM 4.25.3.5.1 for classification requirements.

If CMC manager does not find any errors in the classification effort, then the CMC manager will approve the classification effort and forward to the EG WSD National Gatekeeper and EG WSD Examination Analyst any project/tracking code tables received from CMC classifiers.

The CMC manager is also required to perform a monthly 10% written review of all completed classification efforts; see IRM 4.25.3.1.5 regarding the 10% review requirement.

The EG WSD Examination Analyst reviews a weekly ERCS listing for all returns in primary business code (PBC) 213. This listing will be compared to the Weekly CMC report to create a listing of the following:

Weekly, the EG WSD Examination Analyst will run the automated inventory management report that provides CMC classification metrics to share with the EG WSD Group Manager and CMC managers. The metrics captured in the report include:

For returns selected for review in CMC classification, the EG WSD Compliance Clerk will use the listing provided by the EG WSD Examination Analyst to update the ERCS exam status code from 06 to 08 and any applicable project or tracking codes.

For returns accepted as filed in CMC classification, the EG WSD Compliance Clerk will use the listing of accepted as filed returns provided by the EG WSD Examination Analyst and complete the following steps separately for estate and gift tax returns:

The EG WSD Compliance Clerk will take the following steps with the spreadsheet listing of returns successfully closed out DC 20:

The EG WSD Compliance Clerk will forward the completed spreadsheet in paragraph (3) of this section, along with the text file print out of the returns successfully closed out DC 20, to Kansas City Files using the contact found in the EG WSD CMC Manager/LWIS Delivery Desk Guide.

The EG WSD Compliance Clerk will take the following steps with the spreadsheet listing of returns that did not successfully close out DC 20:

Likely reason(s) a return cannot close under paragraph (2) of this subsection are listed below. In each instance, the account information is required to be sent to *SBSE EEF E&G Campus Classification to address the account issue:

Once the issue on the account is addressed, the EG WSD Compliance Clerk can then use the database tool to close out the return and remove the return from the master listing of returns being monitored for closure.

Requests for prompt assessment of gift tax liability under IRC 6501(d) are sent from Cincinnati Centralized EG Campus Operation to the EG WSD National Gatekeeper. Refer to IRM 25.6.1.9.6.1, Request for Prompt Assessment, for procedures on prompt assessment requests generally and IRM 4.25.2.5.6, Form 4810, for the Cincinnati Centralized EG Campus Operation prompt assessment procedures.

Within two days of receipt of the prompt assessment request, the EG WSD National Gatekeeper will:

The EG WSD Compliance Clerk will:

If the prompt assessment request file cannot be sent electronically to the EG WSD Prompt Assessment Coordinator (e.g., the Form 709 returns are too large and not available on LIN), then the physical file will be mailed by the EG WSD Compliance Clerk to the EG WSD Prompt Assessment Coordinator within two days of receipt, along with a completed Form 3210, Document Transmittal.

Within five days of receipt of the prompt assessment request, the EG WSD Prompt Assessment Coordinator will review and make a determination on the request. If the prompt assessment request was mailed to the EG WSD Prompt Assessment Coordinator, the Coordinator will mail back the request to the EG WSD Compliance Clerk, along with a completed Form 3210.

The prompt assessment request file from the Cincinnati Centralized EG Campus Operation must include the following, consistent with IRM 4.25.2.5.6, Form 4810:

Upon receipt of any prompt assessment request from the Cincinnati Centralized EG Campus Operation, the EG WSD Prompt Assessment Coordinator will first verify the requirements for making a prompt assessment request and confirm the assessment statute expiration date (ASED) applicable to the gift tax return(s) subject to the prompt assessment request; see IRM 25.6.1.9.6.1, Request for Prompt Assessment.

If the requirements for making a prompt assessment are met, then the EG WSD Prompt Assessment Coordinator will:

If the requirements for making a prompt assessment request are not met, then the EG WSD Prompt Assessment Coordinator will deny the request. The EG WSD Prompt Assessment Coordinator will advise the EG WSD National Gatekeeper that the memorandum drafted in paragraph (3) of this section should be attached to the prompt assessment request and to mail the request back to the Cincinnati Centralized EG Campus Operation for purposes of denying the prompt assessment request.

If the EG WSD Prompt Assessment Coordinator selects the return for examination, the EG WSD National Gatekeeper will, within five days of receipt, review the selected issues and the risk rating to ensure it is consistent with the guidelines found in the EG WSD Classification Guide. If this review concludes that the prompt assessment request should not be selected, the EG WSD National Gatekeeper will:

Following the EG WSD National Gatekeeper review in paragraph (5) of this subsection, cases made available for delivery to EG Exam will be handled by the EG WSD National Gatekeeper within one day of the completed review in the following manner:

For prompt assessment requests made available for delivery to EG Exam, the EG WSD Compliance Clerk will within one day of receiving the gift tax return from the EG WSD National Gatekeeper:

Once the gift tax return is fully established on AIMS, the EG WSD National Gatekeeper will:

If the EG WSD Prompt Assessment Coordinator does not select the return for examination, or the EG WSD National Gatekeeper review in paragraph (5) of this subsection determines that the request will not otherwise be delivered to EG Exam, the EG WSD National Gatekeeper will provide the case file and a completed memorandum stating this determination to the Cincinnati Centralized EG Campus Operation for re-filing.

Electronic case files in EG WSD custody will be retained by EG WSD for the required retention period and then destroyed. Refer to IRM 1.15.3.2, Destroying Records in the Custody of the IRS, and Document 12990, Records and Information Management Records Control Schedules.

Prompt Assessment requests are subject to the review requirements found in IRM 4.25.3.1.5, Program Controls.

Upon receiving a selected claim for refund from the Cincinnati Centralized EG Campus Operation, the EG WSD National Gatekeeper will verify that the claim is properly made and timely filed. Refer to IRM 4.25.9.4, Claims for Refund, for procedures on filing claim for refund requests.

If the claim for refund is not properly made, is untimely, or is a protective claim not otherwise appropriate for EG Exam, the EG WSD National Gatekeeper will return the claim to the Cincinnati Centralized EG Campus Operation with documentation as to why the claim is being returned.

If the claim for refund is properly made, the EG WSD National Gatekeeper will review the "Selected Claim Transmittal" form to confirm that the proper claim amount is reported and make corrections as necessary to this form.

Subsequent to the EG WSD National Gatekeeper’s review, selected claims for refund will be forwarded to the EG WSD Compliance Clerk, who will establish the claim on AIMS/ERCS in exam status code 08, EGC 1080. Refer to the EG WSD Handbook on procedures for establishing claims.

Once the claim is fully established on AIMS, the claim will be prioritized for delivery to EG Exam. Refer to IRM 4.25.3.11, Delivering Work to EG Exam, for EG Exam delivery procedures.

Claims from the Cincinnati Centralized EG Campus Operation not available in electronic format will be mailed to EG Exam at the direction of the EG Exam Group Manager. Refer to IRM 4.25.3.11.3, Shipment of Cases, for the procedures to ship paper case files.

Selected claims for refund are subject to the review requirements found in IRM 4.25.3.1.5, Program Controls.

The Cincinnati Centralized EG Campus Operation will forward to the EG WSD Compliance Clerk all of the Form 706-GS(D-1), Notification of Distribution From a Generation-Skipping Trust, where there is no corresponding Form 706-GS(D), Generation-Skipping Transfer Tax Return for Distributions, filed, based on current EG WSD screening criteria. Current screening criteria is maintained by the EG WSD Group Manager on the EG WSD shared drive.

The EG WSD Compliance Clerk will maintain the paper Form 706-GS(D-1) filings until one month following the extension deadline for the Form 706-GS(D). After this time period has passed, the EG WSD Compliance Clerk will confirm that a Form 706-GS(D) has not been filed by reviewing the BMFOLT command code on IDRS.

If a Form 706-GS(D) has not been filed, the EG WSD Compliance Clerk will:

When the Form 706-GS (D) cases are fully established on AIMS/ERCS, the EG WSD National Gatekeeper will review the selected cases to ensure the case meets the EG WSD screening criteria. If this review concludes that a case should not have been selected, the EG WSD National Gatekeeper will draft a memorandum to include in the case file and provide a copy of the memorandum to the Cincinnati Centralized EG Campus Operation via secure email.

EG WSD Compliance Clerk will place cases selected for audit by EG Exam in a designated location for Form 706-GS (D) cases. The EG WSD National Gatekeeper will consider the case for delivery to EG Exam consistent with delivery procedures. Refer to IRM 4.25.3.11.1, Program Workplan and Case Delivery.

Form 706-GS (D) cases surveyed after the EG WSD National Gatekeeper review, or not assigned for examination will be surveyed consistent with the procedures found in IRM 4.25.3.11.2, Post-Delivery and Surveying Cases. If the case is not initially surveyed by the EG WSD Gatekeeper after the review in paragraph (4) of this section, but later not sent to EG Exam, the EG WSD National Gatekeeper will document the reason that the case was later surveyed on the classification sheet. The Form 706-GS (D-1) case file will be sent to the Cincinnati Centralized EG Campus Operation for re-filing.

Form 706-GS (D) cases are currently paper case files and will be mailed to EG Exam; see procedures in IRM 4.25.3.11.3, Shipment of Cases, for the procedures to ship paper case files.

Revenue Agents in other business units may request a four-hour consultation from EG Exam regarding potential estate and gift issues disclosed in the course of their examination by using the Specialist Referral System (SRS).

Revenue Officers may request a four-hour consultation from EG Exam regarding assistance with a taxpayer application for estate tax lien discharge, by using SRS.

EG WSD receives the following referrals from other business units:

Referrals from other business units are subject to the review requirements found in IRM 4.25.3.1.5, Program Controls.

Referrals from other business units may be submitted to *SBSE EGWSD Referral

EG WSD provides returns selected for audit to EG Exam in regular intervals to ensure program workplan progress. See IRM 4.25.3.3, Workplan Development and Inventory. The number of returns delivered to any examination group in a given interval is determined by EG WSD relying upon:

The EG WSD Examination Analyst generates a delivery form at the request of the EG WSD National Gatekeeper prior to return delivery. The form(s) report data for each examination group, including the volume of unassigned returns and program workplan progress (i.e. new starts, closures, etc.). Delivery forms should also report returns available for delivery in CMC/LWIS and any pending closures under IRM 4.25.3.11.2, Post-Delivery and Surveying Cases.

Returns should be delivered electronically to the CBF using the CMC/LWIS system whenever possible, including a copy of the risk summary or other documentation of the EG WSD classification outcome for each delivered return; see IRM 4.25.3.5.1, CMC Classification of Filed Estate and Gift Tax Returns. EG WSD will also deliver any other file(s) considered by EG WSD through the classification process. If a return is not available for delivery via CMC/LWIS, return delivery may be completed using secure email sent directly to the EG Exam Group Manager(s). If a return cannot be delivered electronically, the EG WSD National Gatekeeper and EG WSD Compliance Clerk must arrange for physical delivery of the paper return directly with the EG Exam group with notice to the EG WSD Group Manager.

In delivering work to EG Exam, the EG WSD National Gatekeeper gives priority to the following:

Other returns selected for examination through classification not delivered under paragraph (4) are delivered to EG Exam adhering to the following considerations:

To deliver work to EG Exam, the EG WSD National Gatekeeper will:

To deliver work to EG Exam, the EG WSD Compliance Clerk:

The EG WSD National Gatekeeper should complete a review of the ERCS exam status code 08 inventory following each return delivery. For any returns classified and selected for audit under IRM 4.25.3.5 (i.e. source code 20 regular classification), the EG WSD National Gatekeeper may survey any return due to insufficient time remaining on the assessment statute expiration date (ASED) and/or quality of selected issue using DC 35 without prior approval from the EG WSD Group Manager.

To survey a return, the EG WSD National Gatekeeper provides to the EG WSD Compliance Clerk the MFT, Name Control and/or Taxpayer Name, Tax Period, and TIN for each surveyed return. The EG WSD Compliance Clerk will close each return using the IDRS command code AMSOC as soon as practical. Follow procedures in IRM 4.25.3.6.3, Updating Returns After CMC Classification, to resolve any issues preventing closure (i.e. freeze code).

For returns successfully closed using the IDRS command code AMSOC, the EG WSD Compliance Clerk will:

For any surveyed return classified by EG WSD under IRM 4.25.3.9 (i.e. substitute-for-return, non-filer or other project cases), or IRM 4.25.3.10 (i.e. referrals/consultations), the EG WSD National Gatekeeper will draft a memorandum documenting the reason(s) for closure. A copy of the memorandum should be signed by the EG WSD Group Manager and included in the electronic case file maintained on the EG WSD shared drive for record retention. Refer to IRM 1.15.3.2, Destroying Records in the Custody of the IRS, and Document 12990. For returns surveyed under this paragraph (4), the EG WSD Compliance Clerk will close the return by following the procedures detailed in paragraphs (1)-(3) with the following additional instructions:

When EG WSD has a paper case file to send to EG Exam, the EG WSD Compliance Clerk will send cases to the appropriate EG Exam office, accompanied by a Form 3210, indicating the number of returns included with each shipment. An AIMS status label will be attached to the Form 5348, AIMS/ERCS Update (Examination Update), for each return.

For electronic case files, the EG WSD National Gatekeeper will provide an electronic Form 3210 via secure email to the EG Exam Group Manager indicating for each return transmitted: