SECTION 12. HOW DOES THE

ASSOCIATE OFFICE PREPARE THE TAM OR THE TEAM?

Contacts the field or area office to discuss issues

Informs the field or area office if any matters in the request have been referred to another branch of the Associate office or another Associate office

.01 Upon receipt of a request for a TAM or TEAM, an attorney of the assigned branch of the Associate office should contact the field or area office and any assigned field attorney by telephone to acknowledge receipt of the TAM or TEAM and to establish a point of contact. Then, within 21 calendar days for a TAM or within five calendar days for a TEAM, the assigned Associate office attorney should contact the field or area office to discuss the procedural and substantive issues in the request that come within the branch’s jurisdiction.

.02 If the TAM request concerns matters within the jurisdiction of more than one branch or office, a representative of the branch that received the original TAM request informs the field or area office within 21 calendar days of receiving the request that:

(1) matters within the jurisdiction of another branch or office have been referred to the other branch or office for consideration; and

Sec. 11.10 January 5, 2004 102 2004-1 I.R.B.

Informs the field or area office if additional information is needed

Informs the field or area office of tentative conclusion

If a tentative conclusion has not been reached, gives date estimated for tentative conclusion

Advises the field or area office if tentative conclusion is changed

Generally does not discuss tentative conclusion with the taxpayer

Advises the field or area office of final conclusions

If needed, requests additional information

(2) a representative of the other branch or office will contact the field or area office about the TAM request within 21 calendar days after receiving it in accordance with section 12.01 of this revenue procedure.

If a request for a TEAM involves more than one Associate office, all involved Associate offices should have had the opportunity to participate in the pre-submission conference. Within five calendar days of receipt, the Associate office attorney with primary responsibility over the TEAM will confirm that all involved Associate offices have received copies of the TEAM request and will advise the field or area office as to who is assigned to the TEAM in each Associate office. If, after receiving the TEAM request, the Associate office with jurisdiction determines that coordination with another Associate office is required, the assigned Associate office attorney will also notify the field or area office of the new coordination within five calendar days of the receipt of the TEAM.

.03 The Associate office attorney will inform the field or area office and field counsel that a TAM or TEAM request is being returned if substantial additional information is required to resolve an issue. Cases should also be returned if major procedural problems cannot be resolved by telephone. The field or area office should promptly notify the taxpayer of the decision to return the case and the reason(s) for such decision.

If only minor procedural deficiencies exist, the Associate office attorney will request the additional information in the most expeditious manner without returning the case.

.04 If all necessary information has been provided, the Associate office attorney informs the field or area office within 21 calendar days after receiving the information requested for a TAM and within five calendar days for a TEAM of the tentative conclusion and the estimated date that the TAM or the TEAM will be mailed.

.05 If a tentative conclusion has not been reached because of the complexity of the issue, the Associate office attorney informs the field or area office and field counsel of the estimated date the tentative conclusion will be made.

.06 Because the Associate office attorney’s tentative conclusion may change during the preparation and review of the TAM or the TEAM, the tentative conclusion should not be considered final. If the tentative conclusion is changed, the Associate office attorney will inform the field or area office.

.07 Neither the Associate office nor the field or area office should discuss with the taxpayer or the taxpayer’s representative the tentative conclusion and the rationale for that conclusion during the initial consideration of the request for a TAM or a TEAM. To afford taxpayers an appropriate opportunity to prepare and present their position, however, the taxpayer or the taxpayer’s representative should be told the tentative conclusion when scheduling the adverse conference, at the adverse conference, or in any discussion between the scheduling and commencement of the adverse conference. See section 14.03 of this revenue procedure regarding discussions of the contents of the issued TAM or TEAM with the taxpayer or the taxpayer’s representative.

.08 In all cases, the Associate office attorney will inform the examining agent or appeals officer and field counsel of the Associate office’s final conclusions. The examining agent or appeals officer and field counsel will be offered the opportunity to discuss the issues and the Associate office’s final conclusions before the TAM or the TEAM is issued.

.09 If, following the initial contact referenced in section 12.01 of this revenue procedure, it is determined, after discussion with the branch chief or other reviewer, that additional information is needed, an Associate office attorney will obtain the additional information from the taxpayer or from the director or the appeals area director in the most expeditious manner possible. In the case of a TAM, any additional information requested from the taxpayer by the Associate office must be submitted by letter with a penalties of perjury statement that conforms with the penalties of perjury statement set forth in section 9.01 of this revenue procedure within 21 calendar days after the request for information is made. In the case of a TEAM, any additional

Sec. 12.09 2004-1 I.R.B. 103 January 5, 2004

Requests taxpayer to send additional information to the Associate office and a copy to the director or appeals area director

Informs the taxpayer when requested deletions will not be made

information requested from the taxpayer by the Associate office must be submitted by letter with the penalties of perjury statement that conforms with the penalties of perjury statement set forth in section 9.01 of this revenue procedure within five calendar days after the request for information is made.

(1) Request to receive a request for additional information by fax or email. To facilitate prompt action on TAM and TEAM requests, the taxpayer is encouraged to request that the Service request any additional information from the taxpayer by fax or email.

A request to fax a copy of the request for additional information to the taxpayer or the taxpayer’s authorized representative must be made in writing, either as part of the original TAM or TEAM request or prior to the mailing of the request for additional information. The request to fax must contain the fax number of the taxpayer or the taxpayer’s authorized representative to whom the document is to be faxed.

(2) 21-day period for TAMS and 5-day period for TEAMs will be extended if justified and approved. A written request for an extension of time to submit additional information must be received by the associate office within the 21-day period for TAMs (5-day period for TEAMs), giving compelling facts and circumstances to justify the proposed extension. Only the Associate Chief Counsel of the office to which the case is assigned may determine whether to grant or deny the request for an extension. Except in rare and unusual circumstances, the Associate office will not agree to an extension of more than ten working days beyond the end of the 21-day period in the case of a TAM or a 5-day period in the case of a TEAM. There is no right to appeal the denial of a request for an extension.

(3) If the taxpayer does not submit additional information. If the Associate office does not receive the additional information within the 21-day period for TAMs or within the 5-day period for TEAMs, plus any extensions granted by the Associate Chief Counsel, the Associate office will issue the TAM or the TEAM based on the existing record.

.10 Whether or not requested by the Service, any additional information submitted by the taxpayer should be sent to the attention of the assigned Associate office attorney. Generally, the taxpayer needs only to submit the original of the additional information to the Associate office. In appropriate cases, however, the Associate office may request additional copies of the information.

The taxpayer must also send a copy of the additional information to the director or the appeals area director for comment. Any comments by the director or the appeals area director must be furnished within an agreed period of time to the appropriate branch in the Associate office. If the director or the appeals area director does not have any comments, he or she must notify the Associate office attorney promptly. When the director or the appeals area director receives a copy of the additional information from the taxpayer, the director or the appeals area director must provide field counsel with a copy.

.11 Generally, before replying to the request for a TAM or a TEAM, the Associate office informs the taxpayer orally or in writing of the material likely to appear in the TAM or TEAM that the taxpayer proposed be deleted but that the Service has determined should not be deleted.

If so informed, the taxpayer may submit within ten calendar days any further information or arguments supporting the taxpayer’s proposed deletions.

The Service attempts, if possible, to resolve all disagreements about proposed deletions before the Associate office replies to the request for a TAM or a TEAM. The taxpayer does not have the right to a conference to resolve any disagreements about material to be deleted from the text of the TAM or the TEAM. These matters may be considered at any conference otherwise scheduled for the request. See section 14.05 of this revenue procedure for the procedures to protest the disclosure of information in the TAM or the TEAM.

Prepares reply in two parts .12 The Service prepares replies to TAM or TEAM requests in two parts. Each part identifies the taxpayer by name, address, identification number, and year or years involved.

Sec. 12.09 January 5, 2004 104 2004-1 I.R.B.

The first part of the reply is a transmittal memorandum (Form M–6000). In unusual cases, it is a way of giving the field or area office strategic advice that need not be discussed with the taxpayer. If the transmittal memorandum provides more than the fact that the TAM or the TEAM is attached or the case is returned for further development, the transmittal memorandum may constitute Chief Counsel Advice, as defined in § 6110(i)(1), subject to public inspection under § 6110.

The second part is the TAM or the TEAM, which contains:

(1) a statement of the issues;

(2) the conclusions of the Associate office;

(3) a statement of the facts pertinent to the issues;

(4) a statement of the pertinent law, tax treaties, regulations, revenue rulings, and other precedents published in the Internal Revenue Bulletin, and court decisions; and

(5) a discussion of the rationale supporting the conclusions reached by the Associate office.

The conclusions give direct answers, whenever possible, to the specific issues raised by the field or area office. The Associate office is not bound by the precise statement of the issues as submitted by the taxpayer or by the field or area office and may reframe the issues to be answered in a TAM or a TEAM. The discussion of the issues in a TAM or a TEAM will be in sufficient detail so that the field or appeals officials will understand the reasoning underlying the conclusion.

If two sets of facts are provided to the Associate office ( i.e., the parties were unable to reach agreement on the facts), the following procedure will be used: If the Associate office would rule the same way on either set of facts, a TAM or a TEAM will be issued, which will note that the factual disagreement is immaterial. If the Associate office would rule differently based on which specific set of facts is considered, then a single TAM or a single TEAM will be issued describing the resolution of the issue based on each set of facts.

As discussed in section 14.01 of this revenue procedure, if a TAM or a TEAM provides alternate responses based on separate sets of facts, the field is required to process the case consistently with the legal analysis in the TAM or the TEAM as applied to the facts as they are ultimately determined by the field or area office.

Accompanying the TAM or the TEAM is a notice under § 6110(f)(1) of intention to disclose a TAM or a TEAM (including a copy of the version proposed to be open to public inspection and notations of third party communications under § 6110(d)).

Routes reply to appropriate office .13 Replies to requests for a TAM or a TEAM are addressed to the director or the appeals area director. A copy of the reply to a request from LMSB should be mailed simultaneously to the field personnel who requested it under the signature authority of the director. Replies to requests from appeals should be routed to the appropriate area office through the Appeals Director, Technical Services, C:AP.

Sends copy of reply to appropriate division counsel