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Part 4. Examining Process

Chapter 8. Technical Support (Exam)

Section 4. Mandatory Review

4.8.4  Mandatory Review

4.8.4.1  (10-01-2003)
Overview

  1. This section provides guidelines for the evaluation of cases that must be reviewed.

4.8.4.2  (10-01-2003)
Cases Subject to Mandatory Review

  1. Cases subject to mandatory review include:

    1. Joint Committee cases (See IRM 4.36, Joint Committee Handbook),

    2. Employee audits.

  2. Although there are a limited number of identified mandatory review categories, areas have the discretion to designate any type or group of cases as a 100% review category if reviews are considered essential.

  3. National Research Program (NRP) cases are not mandatory review but may meet other mandatory review criteria. Normal processing procedures should be followed. Reviewers may be requested to conduct in-process reviews.

4.8.4.2.1  (10-01-2003)
Case Identification

  1. Examiners identify case files subject to mandatory review on Form 3198, Special Handling Notice. The mandatory review category should be indicated.

4.8.4.2.2  (10-01-2003)
Subject to EQMS Sampling

  1. Mandatory reviews are first subject to EQMS sampling.

4.8.4.2.3  (10-01-2003)
Joint Committee Cases

  1. Overpayment in excess of $2,000,000 must be reported to the Joint Committee on Taxation as required by IRC § 6405. Complete instructions for processing and review of Joint Committee cases are included in IRM 4.36. Joint Committee cases are reviewed in centralized LMSB review sites.

4.8.4.2.4  (10-01-2003)
Employee Audits

  1. Any employee examination is mandatory review. Any new employee or regular classified employee, regardless of grade or position is subject to the same classification process applicable to all individual income tax returns. Once the case file is selected for examination, it is identified as an employee audit.

4.8.4.2.4.1  (10-01-2003)
IRM References

  1. IRM 4.1.5.20, Area Office Planning and Special Programs Handbook, provides instruction for the classification and selection of employee returns.

  2. IRM 4.2.6, Employee Returns, provides instruction for the survey and examination of employee returns.

4.8.4.2.4.2  (10-01-2003)
Audits of New Employees

  1. Form 2677, Request for Account History and Tax Audit, is required and should be completed in accordance with the instructions on the back of the form.

4.8.4.2.4.3  (10-01-2003)
Key Points for Reviews

  1. Key points for review of employee audits:

    1. confidentiality must be strictly observed,

    2. the Quality Standards should provide the basis of the technical review of the examination,

    3. the review should consideration of compliance by the employee with the Rules of Conduct, and

    4. if the employee and spouse filed separately, ensure the return of the spouse has been associated for review.


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