TEI-LMSB liaison meeting.

February 12, 2009

AGENDA

On February 12, 2009, a delegation from Tax Executives Institute meet with Frank Ng, Commissioner of the IRS's Large and Mid-Size Business Division, and other LMSB officials to discuss issues of concern to TEI's membership. The agenda for the meeting is reprinted below. Minutes from the meeting will be posted on TEI's website as soon as they become available, and will be reprinted in a future issue of The Tax Executive.

1. Welcome and Introduction

2. Case Management and Risk Assessment

   TEI invites a discussion of current case management statistics (2008 v. 2007), specifically:

   * Overall coverage rate

   * CIC currency rate

   * Examination Cycle Time

   * Total Cycle Time

   What effect have the changes in LMSB examination closure rates and cycle times had on other LMSB priorities? What effect, if any, has the economic downturn had on examinations (e.g., budget limitations, travel restrictions)?

3. Key Compliance Initiatives Over the past year, the IRS has initiated several compliance initiatives/research efforts in which TEI has been an active participant: the Roundtable on Tax Transparency and Disclosure (June 5, 2008), the IRS Enterprise Compliance Risk Symposium relating to the growing use of pass-through entities (July 22, 2008), and the International Tax Administration Conference (October 7, 2008). We invite a discussion of LMSB's assessment of these programs. Should taxpayers expect any specific initiatives to flow from these programs and are other programs being planned?

4. Examination-Related Matters

   1. International Examination Program Update. International tax compliance matters occupy an ever-increasing piece of the overall LMSB agenda. U.S. corporations are now doing business in 230 countries and foreign profits of U.S. corporations are becoming a larger percentage of total profits. Total income reported on Form 5471 filings with LMSB now exceeds $1 trillion and foreign tax credits claimed in 2007 totaled more than $80 billion.

      Hence, it is unsurprising that more than half of the current Tier I Industry Issue Focus issues involve international tax matters, e.g., transfer pricing, abusive transactions involving hybrid instruments, section 936, section 965 transactions, foreign tax credit "generators," and most recently "withholding taxes."

      Recent comments by LMSB Commissioner Frank Ng and Deputy Commissioner Barry Shott confirm LMSB's desire to reshape its business processes and practices to adapt to taxpayers that are increasingly being characterized as "enterprise structures, multi-tiered and multinational entities."

      Against this background, TEI invites a discussion on the following:

      * The strategic approach to be taken to reshape LMSB;

      * The function and composition of the new International Planning and Operations Council; and

      * Resource/Staffing considerations (in cluding external hiring or internal reallocations).

   2. Effect of Cost Sharing/Services Regulations. TEI invites a discussion of the reaction LMSB has received from foreign jurisdictions to the...