SECTION 4. CASE ELIGIBILITY

AND EXCLUSIONS

1. Subject to the limitations set forth below, SB/SE FTS is available for cases in SB/SE jurisdiction if:

(1) The case contains disputed factual

or legal issues; (2) Issues are fully developed; and (3) The issues remain unresolved after

the involvement of the Group Manager.

2. SB/SE FTS is not available for:

(1) Cases in which SB/SE FTS is not

appropriate under either 5 U.S.C. § 572 or 5 U.S.C. § 575, which provide the general authority and guidelines for use of alternative dispute resolution in the administrative process; (2) Cases in which the taxpayer did not

act in good faith during the audit process, such as, but not limited to, cases in which the taxpayer failed to cooperate or unduly delayed the audit process; (3) Correspondence examination cases

worked solely in a Campus/Service Center site; (4) Partnership cases under the Tax Eq uity & Fiscal Responsibility Act (TEFRA); (5) Collection cases. Examples include,

but are not limited to, Collection

Bulletin No. 2017–14 1039 April 3, 2017

Due Process, Collection Appeals Program, Offer-In-Compromise and Trust Fund Recovery Penalty cases; (6) Issues designated for litigation; (7) Issues docketed in any court; (8) Issues precluded from settlement by

previous closing agreements, res judicata, or controlling Supreme Court precedent; (9) Issues for which SB/SE FTS would

not be in the interest of sound tax administration. For example, issues common to issues in litigation for which it is important that the IRS maintain a consistent position, or issues common to issues in litigation over which the Department of Justice has jurisdiction; (10) Frivolous issues, such as, but not

limited to, those identified in section 6.10 of Rev. Proc. 2016–1, 2016–1 I.R.B. 1, or the corresponding provision of any successor guidance; (11) “Whipsaw” issues, or issues for

which resolution with respect to one party might result in inconsistent treatment in the absence of participation of another party. Examples include, but are not limited to, issues on a joint return where both spouses do not agree to participate in the same FTS Session ( see section 6.02 of this revenue procedure) or where one spouse is claiming innocent spouse treatment under section 6015; (12) Issues for which the taxpayer has

submitted a request for competent authority assistance. See section 6.03 of Rev. Proc. 2015–40, 2015–35 I.R.B. 236, or the corresponding provision of any successor guidance, which describes the procedures of the U.S. competent authority for coordination with IRS examination proceedings. Under section 6.03(3) of Rev. Proc. 2015–40, the taxpayer’s access to U.S. competent authority assistance is generally not affected by the taxpayer’s pursuit of alternative dispute resolution programs under the jurisdiction of IRS Examination, including SB/SE FTS. Taxpayers are cautioned that if resolution of the taxpayer’s competent authority issue (as defined

in Rev. Proc. 2015–40) is reached through the SB/SE FTS process, the taxpayer’s access to U.S. competent authority assistance will be determined in accordance with sections 6.03(1) and 6.03(2) of Rev. Proc. 2015–40. If a taxpayer enters into a closing agreement (including settlement through the SB/SE FTS process) and then requests competent authority assistance, the U.S. competent authority will endeavor only to obtain a correlative adjustment from the treaty country and will not take any actions that would otherwise change the settlement. See section 6.03(2) of Rev. Proc. 2015–40. If a taxpayer enters into SB/SE FTS, the taxpayer generally may not request competent authority assistance until the SB/SE FTS process is complete. However, the taxpayer may file a protective claim with the competent authority in the form of a competent authority request or a letter while SB/SE FTS is pending if a protective claim is necessary to keep open the period of limitations in a foreign country. See section 11.03 of Rev. Proc. 2015–40. If the requirements of this section 4.02(12) have been satisfied and a protective claim has been filed, the taxpayer must notify the U.S. competent authority that the case is in alternative dispute resolution in SB/SE FTS. In addition, the taxpayer must notify the FTS Appeals Official (as defined in section 6.01 of this revenue procedure) that a protective claim has been filed and that the provisions of this section 4.02(12) have been satisfied. The U.S. competent authority will suspend action on the case until SB/SE FTS is completed; (13) Issues outside SB/SE jurisdic tion; or (14) Issues that have been otherwise

identified in subsequent guidance issued by the IRS as excluded from the SB/SE FTS process.

3. If any one issue is determined not to be eligible for SB/SE FTS, no issues in the case shall be eligible for SB/SE FTS.