The IRS Large Business and International (LB&I) division announced on Jan. 31 a list of 13 different “campaigns” the government would pursue as part of its move toward issue-based examinations affecting large and midsized businesses.
These campaigns come as part of a recent restructuring of LB&I by the IRS in the wake of resource constraints. The campaigns are identified by the IRS through data analysis, suggestions from IRS compliance employees and feedback from the tax community. The IRS’s goal is to identify and reduce noncompliance through the campaigns, which will feature a mix of issue-focused examinations
, externally published guidance, practitioner outreach and soft letters. The initial list of campaigns is likely to be expanded, and some campaigns may be removed in favor of others.
The 13 initial examination campaigns are:
- Section 48C energy credit
- Declines and withdrawals of the Offshore Voluntary Disclosure Program
- Section 199 domestic production activities deduction (DPAD) deductions by multi-channel video program distributors and TV broadcasters
- Micro-captive insurance arrangements
- Related-party transactions between commonly controlled entities
- Deferred variable annuity reserves and life insurance reserves
- Basket transactions
- Land developers and the completed contract method
- Tax Equity and Fiscal Responsibility Act linkage
- S corporation losses claimed in excess of basis
- Repatriation of foreign earnings for middle-market taxpayers
- Form 1120-F nonfilers
- Inbound distributors
The IRS anticipates partnering with various stakeholder groups to disseminate more information on these campaigns, which will be largely managed by the appropriate executive within LB&I. While there is still some ambiguity regarding how the campaigns will be administered and regarding how they will supplement or supplant other IRS examinations, it is expected that many of these details will be revealed in the near future by the IRS.
National Managing Principal, Washington National Tax Office
+1 202 521 1515
Experience Manager, Washington National Tax Office
+1 202 521 1511
Tax professional standards statement
This content supports Grant Thornton LLP’s marketing of professional services and is not written tax advice directed at the particular facts and circumstances of any person. If you are interested in the topics presented herein, we encourage you to contact us or an independent tax professional to discuss their potential application to your particular situation. Nothing herein shall be construed as imposing a limitation on any person from disclosing the tax treatment or tax structure of any matter addressed herein. To the extent this content may be considered to contain written tax advice, any written advice contained in, forwarded with or attached to this content is not intended by Grant Thornton LLP to be used, and cannot be used, by any person for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code.
The information contained herein is general in nature and is based on authorities that are subject to change. It is not, and should not be construed as, accounting, legal or tax advice provided by Grant Thornton LLP to the reader. This material may not be applicable to, or suitable for, the reader’s specific circumstances or needs and may require consideration of tax and nontax factors not described herein. Contact Grant Thornton LLP or other tax professionals prior to taking any action based upon this information. Changes in tax laws or other factors could affect, on a prospective or retroactive basis, the information contained herein; Grant Thornton LLP assumes no obligation to inform the reader of any such changes. All references to “Section,” “Sec.,” or “§” refer to the Internal Revenue Code of 1986, as amended.