SECTION 10. REVIEW BY NATIONAL

OFFICE

.01 In general . The national office may review any application filed under this revenue procedure. If the national office reviews an application, the procedures in sections 10.02 and 10.03 of this revenue procedure apply.

.02 Incomplete application .

(1) 30-day rule . If the national office reviews an application and determines that the application is not properly completed (see section 6.02(1)(c) of this revenue procedure), or if supplemental information is needed, the national office will notify the taxpayer. The notification will specify the information that the taxpayer needs to provide and permit the taxpayer 30 days from the date of the notification to furnish the information. The national office reserves

the right to impose shorter reply periods if subsequent requests for additional information are made. The national office may grant a taxpayer an extension of the 30-day period to furnish information, not to exceed 30 days. A taxpayer must request any extension of the 30-day period in writing and submit it within the initial 30-day period. If the national office denies an extension request, there is no right of appeal.

(2) Failure to provide additional infor- mation . Ordinarily, if the taxpayer fails to provide the additional information on a timely basis, the application does not qualify for the automatic consent procedures of this revenue procedure. If the national office determines that the application does not qualify for the automatic consent procedures of this revenue procedure because the taxpayer has failed to provide the additional information on a timely basis, the national office will notify the taxpayer that consent to make the change in method of accounting is not granted.

.03 National office determination .

(1) Conference in the national office . If the national office tentatively determines that the taxpayer has changed its method of accounting without complying with all the applicable provisions of this revenue procedure (for example, the taxpayer changed to a method of accounting that varies from the applicable accounting method described in this revenue procedure or the taxpayer is outside the scope of this revenue procedure), the national office will notify the taxpayer of its tentative adverse determination and will offer the taxpayer a conference, if the taxpayer requested one. For conference procedures for taxpayers other than exempt organizations, see section 10 of Rev. Proc. 2011–1 (or successor). For conference procedures for exempt organizations, see section 12

January 24, 2011 351 2011–4 I.R.B.

treatment of the item is included as an item of adjustment in the examination report referred to Appeals or is specifically identified in writing to the taxpayer by Appeals. If an appeals office submits to the Joint Committee on Taxation pursuant to § 6405 a report of a refund or credit that includes a method of accounting for an item that is an issue under consideration, that method of accounting continues to be an issue under consideration by the appeals office while the refund or credit is under review by the Joint Committee on Taxation.

(2) Change to section 3.08(3), Before a federal court . Section 3.08(3) of Rev. Proc. 97–27, is modified to read as follows:

(3) Before a federal court . A taxpayer’s method of accounting for an item is an issue under consideration for the taxable years before a federal court if the treatment of the item is included as an item of adjustment in the statutory notice of deficiency, the notice of claim disallowance, the notice of final administrative adjustment, the pleadings (for example, the petition, complaint, or answer) or amendments thereto or is specifically identified in writing to the taxpayer by the counsel for the government. If a settlement stipulation that includes a method of accounting for an item that is an issue under consideration is submitted to the Joint Committee on Taxation pursuant to § 6405, that method of accounting continues to be an issue under consideration by the federal court while the settlement stipulation is under review by the Joint Committee on Taxation.

.03 Change to section 4.02, Scope, “In- applicability” . Section 4.02(2) of Rev. Proc. 97–27, is modified to read as follows:

(2) Under examination . If the taxpayer is under examination, except as provided in sections 6.01(2) (90-day window), 6.01(3) (120-day window), 6.01(4) (director consent), 6.01(5) (issue pending), 6.02 (issue under consideration by an appeals office) and 6.03 (issue under consideration by a federal court) of this revenue procedure;

.04 Changes to section 6, PROCE- DURES FOR TAXPAYERS UNDER EX- AMINATION, BEFORE AN APPEALS OFFICE, OR BEFORE A FEDERAL COURT .