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A letter report issued by the General Accounting Office with an abstract that begins "Pursuant to a legislative requirement, GAO examined the Internal Revenue Service's (IRS) financial statements for the fiscal year (FY) ending September 30, 1998."

A letter report issued by the General Accounting Office with an abstract that begins "Pursuant to a congressional request, GAO reviewed the Internal Revenue Service's (IRS) programs for resolving pension-plan deviations from tax-exemption requirements, focusing on: (1) the frequency and types of pension plan qualification failures that were detected and corrected through IRS audits; (2) the frequency and types of pension plan qualification failures that were identified by pension plan sponsors and reported to IRS for approval of the correction; (3) the sanctions established under IRS' audit program with the compliance fees that could have been imposed if the same qualification failures had been self-reported by the pension plans to IRS; and (4) whether any cost-effective means, other than pension plan audits, have been identified that would detect unreported qualification failures."

AbstractThis study examines the determinants of firms' requests for Private Letter Rulings (PLRs) from the US Internal Revenue Service (IRS) and their impact on firms' cash holdings. Our results show that PLR requests tend to be made by firms with more active tax planning, more acquisitions, higher analyst following, higher leverage, and less in‐house tax expertise. We also show that firms with IRS audit red flags are less likely to request a PLR. We use a difference‐in‐difference approach to assess changes in cash holdings following PLR requests and report a decrease in cash holdings for PLR firms, consistent with the notion that PLRs act to reduce tax uncertainty. Our study provides the first empirical evidence about the determinants of PLR requests and complements prior work on tax uncertainty and cash holdings (Hanlon, Maydew and Saavedra, 2017).

The large case audit program was established to more effectively audit large complex corporations with multiple subsidiaries in various locations, domestic and international. The audits are handled by using a team approach, led by a case manager and team coordinator who coordinates the efforts of agents and specialists. The IRS is currently engaged in a program of quality improvement for the large case or CEP audits (Coordinated Exam Program). Ten initiatives were adopted to assist in improving the large case program. The goal is to bring examinations more current and settle more issues at the exam level. As of September 1990, over $26 billion of the $36 billion of CEP issues in Appeals were factual issues. If successful, the Government will accelerate collection of taxes, and speeding up the exams could save the large case taxpayers millions of dollars in interest. Large case taxpayers are audited for every year, requiring ongoing audit preparation. This research paper includes sections on record keeping, record retention agreements for machine sensible records, ways to handle the audit effectively, audit documentation, and disclosures. In addition, sections are included on the Industry Specialization Program and technical advice requests. Effective management of IRS audits are necessary to minimize the deficiencies assessed against the taxpayer. It is hoped that this paper can be helpful in that respect.

A letter report issued by the General Accounting Office with an abstract that begins "Reported declines in the rate at which the Internal Revenue Service (IRS) audits (also referred to as "examines") individual income tax returns have raised concerns that taxpayers may have a false perception of the true level of IRS's tax enforcement efforts. In addition, many observers are concerned these reported declines may reduce taxpayers' motivation to voluntarily pay their taxes. Because of these concerns, GAO was asked to review a number of issues surrounding IRS's enforcement efforts. GAO determined the trends in the percent of returns filed that are audited (contact rate) compared with similar data on taxpayer contacts through other enforcement programs for fiscal years 1993 through 2002. In addition, GAO reviewed whether IRS's reporting on its enforcement programs should be expanded."

Testimony issued by the General Accounting Office with an abstract that begins "This testimony discusses (1) the relationship between Internal Revenue Service (IRS) audits of taxpayers and other programs IRS uses to ensure that taxpayers' returns are accurate and (2) how IRS is managing the increased workload in two of its programs--offers-in-compromise and innocent spouse claims. IRS audited more than 600,000 taxpayers in fiscal year 2000, either face-to-face or through the mail. IRS has several programs that use computerized screening procedures to review all tax returns to detect certain types of errors. These programs result in millions of contacts with taxpayers to inform them of adjustments IRS made to their liabilities, seek explanations for errors IRS believes were made, or ask taxpayers to check whether they erred on their returns. The programs vary in their similarity to audits; some of the programs are most similar to audits that IRS conducts through the mail. The programs that IRS uses to detect errors on tax returns rely completely on information that taxpayers report on the tax returns and that IRS receives from third parties. Therefore, audits remain an important tax enforcement tool. Several factors suggest that IRS may be gaining better management control over the innocent spouse workload. Unlike the offer-in-compromise program, the workload for the innocent spouse program appears to have leveled off after increases following enactment of the IRS Restructuring and Reform Act. With this leveling off and enhancements to its case processing capacity, IRS plans to move many cases back into its centralized case processing facility this fiscal year, potentially freeing up hundreds of field staff to return to other examination-related duties. In the last two years, the offer-in-compromise program has experienced a greater rise in its workload and is not as far along as the innocent spouse program in implementing processes that IRS believes will help gain better control over the workload."

A letter report issued by the General Accounting Office with an abstract that begins "Pursuant to a congressional request, GAO reviewed how effectively the Internal Revenue Service (IRS) selects individual income tax returns for audit, focusing on: (1) the extent to which IRS district offices have used various sources to select these individual returns for audit; and (2) comparing the results of audits selected using these sources in terms of the rate at which audits recommended no-change to the tax reported, amount of additional taxes recommended per return audited, and rates at which IRS assessed and collected such recommended taxes after the audit."