Tax Executives Institute-Internal Revenue Service Liaison Meeting Agenda.

On February 23, 2000, a delegation from Tax Executives Institute met with Commissioner Rossotti and other senior officials of the Internal Revenue Service about the IRS modernization initiative and other issues of common concern. The Institute's delegation was led by Charles W. Shewbridge, III of BellSouth Corporation, TEI's International President. The agenda for the meeting, which was submitted in advance of the meeting, is reprinted below. The minutes of the meeting, including a list of the participants, will be published in a future issue of The Tax Executive.

1. Introductory Comments

   Tax Executives Institute is pleased to have this opportunity to meet with Commissioner Rossotti, Chief Counsel Brown, and other representatives of the Internal Revenue Service, including officials from Appeals and the Large and Mid-Size Business (LMSB) Division. As an association of corporate tax professionals, TEI is firmly committed to working with the IRS in facilitating the IRS's ongoing modernization efforts, improving the tax guidance system, and generally improving federal tax administration. We look forward to our February 23 liaison meeting and to continuing good relations with the IRS.

2. IRS Modernization

   For more than 18 months, Tax Executives Institute has been pleased to have worked with the IRS on its modernization efforts. Our members have contributed to numerous IRS design teams, and the Institute is pleased to have cosponsored the January 13-14 conference "The New IRS Stands Up: What the Modernized Agency Means for You."

   During the liaison, we invite a discussion of the IRS's modernization efforts, especially as they relate to taxpayers in the LMSB Division. In particular, we request comments on the following issues:

   1. Transition Issues

      As the IRS moves closer toward implementation of its new industry-based design, taxpayers represented by TEI's membership have begun to become more and more interested in how the new structure will affect them. Although many members of the Institute's leadership (such as those who attended the Modernization Conference) have a reasonably good understanding of how the LMSB Division will operate, members of TEI's rank-and-file have not devoted significant time to the new structure. They are now concerned with issues as elementary as (1) how will current audits be affected when the LMSB Division "stands up"; (2) what factors will be taken into account in determining the industry group to which particular companies (especially conglomerates or multi-faceted corporations) are assigned and what role taxpayers will play in the assignment decision; (3) what is "the chain of command" in the new IRS (e.g., what are the relative roles of territory managers and directors of field operations); and (4) whether Coordinated Examination Program taxpayers will continue to have access to a designated individual to resolve questions concerning their accounts at IRS Service Centers. There obviously are many, many more questions that particular taxpayers will have as they come face-to-face with the reorganized agency.

      We recognize that the IRS (and the LMSB Division in particular) is planning a series of "town meetings" to help explain the new structure to taxpayers. Such a "retail" approach to the implementation is commendable, and we look forward to working with the LMSB Division in scheduling and conducting these sessions. (We also welcome the involvement of the Industry Directors, as well as Division Commissioner Larry Langdon, in TEI's upcoming Midyear Conference, for we assume those introductory sessions will be precursors of regular meetings on an industry-by-industry basis.)We submit, however, that even if these meetings exceed expectations in terms of attendance, there will be major portions of TEI's membership and the LMSB class of taxpayers generally (as well as, perhaps, IRS employees) who will not "get the word" on a timely basis. Accordingly, we recommend that the four operating divisions consider preparing a series of frequently asked questions (FAQs) in respect of both the transition to and the ongoing operation of the division. TEI would be pleased to assist the IRS in the effort, for example, by reviewing proposed questions and their answers and, ultimately, by publishing the final FAQs both in The Tax Executive magazine and on the Institute's Internet site (or at least including a link to the IRS's website on our own).

   2. Liaison Activities

      Moving from how IRS modernization affects particular taxpayers to the more parochial issue of how organizations such as TEI should interact with the reorganized agency, we invite a discussion of how TEI should interact with the IRS on an ongoing basis. The Institute's concerns relate to national liaison activities as well as local efforts. Indeed, the leaders of TEI's local chapters are becoming more and more anxious over whom they should be meeting with on a liaison basis (i.e., in lieu of their previous liaison meetings with district directors). A similar question also exists in respect of regional liaison efforts.

   3. Appeals

      On February 16, a TEI delegation will meet with Daniel L. Black, National Director of Appeals, and other representatives of Appeals to discuss several issues relating to IRS modernization. During the February 23 liaison, we anticipate that a report on that Appeals meeting will prompt a further discussion, with particular emphasis on the following issues:

      1. Appeals Staffing Levels. There have been several reports recently of significant forthcoming reductions in Appeals staffing. We invite a report on the anticipated level of any such reductions and what steps, if any, the IRS is prepared to take to ensure that the reductions will not adversely affect the ability of Appeals to fulfill its mission.

      2. Ex parte Communications by Appeals Personnel with Other IRS Employees. (Note: On December 15, 1999, TEI filed comments on Notice 99-50 with the IRS.) We invite a report on what changes to the proposed revenue procedure are likely in response to the comments filed by TEI and others. In particular, are any changes anticipated in respect of the extent to which the ban on ex parte communications applies to Counsel personnel?

      3. Alternative Dispute Resolution Techniques. During the liaison meeting, we invite a discussion of various ADR techniques, including the mediation and the recently announced two-year test on arbitration. Also, are any changes anticipated in the level of approval required before an Appeals officer can settle issues?

   4. Pre-Filing Agreements

      TEI is pleased to have worked with the IRS design team on the development of a pre-filing agreement procedure. We share the IRS's enthusiasm for the initiative because we agree that pre-filing holds great promise for...