TEI--Commissioner of internal revenue and large business & international division liaison meeting agenda.

June 4, 2014

Commissioner's 2014 Priorities

In testimony to the Senate Finance Committee in connection with his recent confirmation, the Commissioner identified several key challenges that the IRS faces today, including a decline in budget resources, an increase in workload, and a loss of public trust and confidence. We invite a discussion of the Commissioner's priorities in addressing these and other challenges faced by the agency.

Budget and Staffing Challenges

1. Agency-Wide

   The IRS's enforcement responsibilities have grown significantly over the past few years, yet the agency's budget has been reduced by almost $1 billion since fiscal 2010 and is presently below fiscal year 2009 appropriation levels. We invite the Commissioner to provide an update on the IRS's current budget, increases or decreases in current year staffing, and budget and staffing expectations for the next fiscal year, including prospects for obtaining increased funding.

2. Operating Divisions

   TEI invites senior leaders of the IRS's operating divisions to discuss the challenges arising from budget cuts and resource drains (e.g., the Affordable Care Act and FATCA implementation) on their particular divisions and the steps the divisions are taking to overcome these challenges, in particular:

   * Effects on guidance projects;

   * Effects on examination teams;

   * Effects on IRS Service Center resources dedicated to large case taxpayers; and

   * Effects on Appeals' staffing of Appeals Team Case Leaders and subject matter experts.

3. IRS Participation in Stakeholder Events

   Tax administration is enhanced through interactions between revenue officials and taxpayers outside the enforcement environment. For example, IRS participation in TEI's national, regional, and chapter educational events provides the IRS with an avenue for communicating technical positions and policy shifts with one of its largest stakeholder groups, as well as a means for gathering unfiltered taxpayer comments on tax administration issues. We appreciate the efforts IRS officials have made to attend our educational sessions. Over the past year, however, TEI has seen a significant decline in IRS participation in its educational events, due in large part to the IRS's budget constraints. We are hopeful that the IRS will be able to ease travel restrictions and allow officials to have greater face-to-face contact with stakeholders at all levels.

   We invite representatives from Chief Counsel, LB&I, and Appeals to provide their thoughts on this topic, as well as on IRS operating procedures that impact IRS participation in stakeholder events and how TEI can assist IRS personnel navigate through the approval process.

   Appeals

1. Update on Appeals Operations

   TEI invites a discussion of the status of Appeals Office operations, including overall case volume, case closure rate, and average time-to-closure for Coordinated Industry Cases and Industry Cases. Further, we welcome Appeals' observations on realistic expectations for taxpayers entering the Appeals process with respect to:

   * Time to an opening conference;

   * Time to case completion; and

   * Availability of experts--e.g., economists, international specialists, and other subject matter experts.

   In addition, TEI members would benefit from a discussion of new initiatives being implemented or considered (e.g., new alternative dispute resolution procedures).

2. Implementation of "Appeals Judicial Approach and Culture"

   In 2012, Appeals initiated its judicial approach and culture (AJAC) project to clarify the office's independent, quasi-judicial role within the IRS. Under AJAC principles, Appeals will not raise new issues and will not reopen otherwise closed issues. Further, Appeals will not function as the initial reviewer of records and thus will send a case back to Examination if a taxpayer provides new information. In July 2013, the IRS issued guidance to Appeals personnel on how to use AJAC principles in working cases. With this backdrop, TEI invites a discussion on steps the Appeals Division is taking to implement AJAC. How have funding issues impacted training? In addition, we invite discussion on what processes and procedures have been identified that require updating to coalesce with AJAC principles, the timing of forthcoming guidance on what constitutes a new issue as opposed to a new argument, and the prospects for the Appeals organization having dedicated Appeals counsel.

   Compliance Assurance Process

   TEI's membership includes employees of 114 different taxpayers that participate in the CAP program. In 2005, TEI established a CAP subcommittee to provide a forum for its members to share information and provide feedback to senior LB&I officials who oversee the program. For the past several years, leadership of the subcommittee have had monthly conference calls with LB&I officials to discuss common concerns and best practices and to propose solutions to recurring problems encountered by taxpayers during CAP examinations. We believe this cooperative, transparent environment is key to the CAP program and are hopeful that it will continue. Our members have generally been pleased with the CAP program's results, and the IRS professionals charged with implementing and administering the program should be commended. As CAP continues to evolve and expand, we encourage the IRS to stay true...