SECTION 7. EFFECT OF CONCLUSION

OF EXAMINATION

If Examination issues a preliminary notice of deficiency (‘‘30-day letter’’) with respect to any issue that is not accepted for early referral, all unagreed issues, including any early referral issues that have not yet been settled by Appeals, will be combined in the 30day letter. Likewise, if no issues in the case remain unagreed except for the early referral issues that are pending in Appeals, a 30-day letter will be issued solely with respect to the early referral issues. The issuance of the 30-day letter generally will constitute the first letter of proposed deficiency which allows the taxpayer an opportunity for administrative review for purposes of the increased underpayment rate for large corporate underpayments under § 6621(c).

Except as provided in section 6.03(2), once Appeals assumes jurisdiction over the case, all issues, including all early referral issues that have not yet been settled by Appeals, will be considered under established Appeals procedures.

If no issues in the case remain unagreed except for an early referral issue that could not be settled by Appeals and has been returned to Examination, no 30-day letter will be issued. Rather, a statutory notice of deficiency (‘‘90-day letter’’) will be issued, which will start the period for the increased underpayment rate for large corporate underpayments under § 6621(c).