SECTION 3. SCOPE — Internal Revenue Bulletin 2005-23

This revenue procedure applies to all examinations, inspections of books of account, and reopenings of cases closed after examination, regardless of taxpayer or type of tax, but does not extend to cases beyond the jurisdiction of the highest level field official with ultimate authority over the case, presently the Area Director for Compliance or the Industry Director. It does not apply to cases closed after consideration by Appeals or any functional component of the Office of Chief Counsel.

The categories and examples in section 4.03 below of contacts with taxpayers and other actions taken by the Service with respect to taxpayers that are not examinations, inspections, or reopenings are not intended to be, and should not be construed as, exhaustive, exclusive, or limitative. Thus, a contact with, or other action in relation to, a taxpayer may be other than

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category 4.03(3) are not reopenings. Examples include adjustments for:

(a) a correction under section 1311; (b) a change to an item carried back that affects liability for the carryback year; and

(4) A fourth category consists of contacts, compliance checks, examinations, or investigations of a taxpayer or a third party for one purpose, tax, or period (even if a dual purpose is present at the outset) that result in the Service obtaining information relevant or useful for a different purpose, tax, or period that may later either be matched with a return under the circumstances described in section 4.03(1) or may lead the Service to later open an examination or inspection for that different purpose, tax, or period. For example, a contact with a taxpayer, including an inspection of the taxpayer’s books of account, for the purpose of investigating a possible violation of title 31 is not an examination, inspection, or reopening for any purpose under title 26. Other examples include:

(a) a contact by a Tax Exempt and Government Entities (TE/GE) agent with the employer sponsor of a deferred compensation plan, or with an organization treating itself as tax-exempt, to investigate the plan’s compliance with Code requirements or the organization’s exempt status under the Code. This contact, and any follow-up information matching, is not an income tax examination, inspection, or reopening with respect to the employer, its employees, any plan beneficiaries, or any other third parties that may have a transactional relationship to the exempt organization (such as the organization’s employees, independent contractors, taxable subsidiaries, or sellers of property to the exempt organization); and

(b) a contact with or action taken with respect to any person for the purpose of determining whether that person is required to maintain a list under section 6112(a), or to inspect the list required to be maintained under section 6112(a), or to verify the accuracy of, or the need for, disclosure of a reportable transaction as required by section 6111 (or registration of a tax shelter as required by former section 6111). This contact or other action is not an examination, inspection, or reopening with respect to any other party.

district court, or the United States Court of Federal Claims with respect to a Notice of Final Partnership Administrative Adjustment (FPAA) expires and no action has been filed. A TEFRA partnership case is an agreed case and is closed as an agreed case only if all partners have signed settlement agreements or a no-change letter has been issued to the Tax Matters Partner. A no-change FPAA alone does not signify an agreed case.

.02 Reopening . A reopening of a closed case involves an examination of a taxpayer’s liability that may result in an adjustment to liability unfavorable to the taxpayer for the same taxable period as the closed case, with exceptions, some of which are noted below. The Service’s review, including an inspection of books of account, of a taxpayer’s claim for a refund on an amended excise or income tax return, as well as the Service’s review of a Form 843, Claim for Refund and Request for Abatement, claiming a refund for an overpayment reported on a return, is not a reopening.

.03 Taxpayer contacts and other actions that are not examinations, inspections, or reopenings . In addition to the exception provided in § 301.7605–1(h) of the Procedural and Administrative Regulations, listed below are four categories of contacts the Service makes with taxpayers and certain other actions taken by the Service that are not examinations, inspections, or reopenings.

(1) In the first category are narrow, limited contacts or communications between the Service and a taxpayer that do not involve the Service inspecting the taxpayer’s books of account:

(a) looking at a tax return; (b) matching information on a tax return with, or preparing a missing return from, other records or information items that are already in the Service’s possession; or

(c) considering any records the taxpayer voluntarily provides to the Service to explain an apparent error on a tax return or to explain a discrepancy between either a filed tax return or a substitute for return and information from third parties that is or may be used for the matching described in (b).

(d) The following examples, illustrative of this category 4.03(1), are not examinations, inspections, or reopenings:

(i) a contact with a Coordinated Industry Case (CIC) taxpayer requesting the written statements provided for in Rev. Proc. 94–69, 1994–2 C.B. 804 (or successor revenue procedure), or notifying a taxpayer that the taxpayer no longer qualifies for the CIC program;

(ii) a contact with a taxpayer to: (A) correct mathematical or clerical errors;

(B) request the taxpayer file a tax return, or if a tax return is incomplete, to explain the criteria for perfecting the tax return, or to solicit the taxpayer’s perfection of the tax return; or

(C) verify a discrepancy between the taxpayer’s tax return and an information return, or between a tax return and information otherwise in the Service’s possession; and

(iii) adjustments resulting from: (A) an unallowable item; (B) a discrepancy between a filed tax return and information received from a third party or a federal or state governmental databank; or

(C) an information-return matching program, or other correction programs operated by Internal Revenue Service Centers or Campuses.

(2) In the second category are Serviceadministered programs for selective issue resolution that are open to the voluntary participation of taxpayers, and which invite the Service’s involvement with respect to one or more taxable periods earlier than otherwise under the Service’s normal audit procedures. The following are examples of these Service-administered programs:

(a) accelerated issue resolution; (b) the Advance Pricing Agreement program;

(d) the Industry Issue Resolution program.

(3) The third category consists of reconsiderations (and resulting adjustments to liability) of a taxable period previously examined or adjusted when those reconsiderations arise from and are affected by the treatment of, or a position taken with respect to, tax return items or transactions by the same taxpayer in a different (usually later) taxable period, or by a related taxpayer in any taxable period. Cases in this

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of account must be signed by, an official listed in Commissioner Delegation Order Number 57 (or successor order) for cases under his or her jurisdiction.