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Part 4. Examining Process

Chapter 11. Examining Officers Guide (EOG)

Section 29. Transfer of Returns Open for Examination

4.11.29  Transfer of Returns Open for Examination

4.11.29.1  (04-01-2005)
References

  1. The references are:

    • Treas. Reg. §301.7605-1–Time and Place of Examination

    • Treas. Reg. §301.7605-1(e) – Requests By Taxpayers to Change Place of Examination

    • IRM 4.4.33 – Transfer of Returns

    • IRM 4.1.4.39 – Transfer of Returns (PSP)

    • IRM 4.10.2.8.3 – Transfers of Returns Prior to the Initial Appointment

    • AIMS Web Site – http://psp.web.irs.gov/AIMS.html

4.11.29.2  (04-01-2005)
Overview for Transfer of Returns Open for Exam

  1. Generally, the examination of any income tax return is the responsibility of the Area in which the taxpayer resides, conducts its business or maintains its principal office. The examination will be assigned to an examiner at the post-of-duty nearest to the taxpayer's residence or place of business.

  2. It may become necessary to transfer a return to an office within the Area or to another Area after the examination has begun. The convenience of the taxpayer will be balanced with the requirements of sound and efficient tax administration in honoring a request for transfer.

  3. Generally, the place where the records of the taxpayer are located, where the principal investigative work will be performed, or where the major tax issues can most conveniently be disposed of, will control the decision as to where the examination will be conducted.

4.11.29.3  (04-01-2005)
Examiner's Responsibility

  1. It is the examiner's responsibility to:

    1. Determine if the request for transfer is allowable, and

    2. Prepare the case file for transfer.

4.11.29.4  (04-01-2005)
Circumstances Which Permit A Transfer Of Examination

  1. Treas. Reg. §301.7605-1(e)(2)(i) provides that a request by a taxpayer to transfer the place of examination for an office examination will generally be granted under the following circumstances:

    1. If the current residence of the taxpayer, in the case of an individual or sole proprietorship, or the location where the taxpayer's books, records, and source documents are maintained, in the case of a taxpayer entity, is closer to a different Service office in the same Area as the office where the examination has been scheduled, the Service normally will agree to transfer the examination to the closer Service office.

    2. If the current residence of a taxpayer, in the case of an individual or sole proprietorship, or the location where a taxpayer entity's books, records, and source documents are maintained, is in an Area other than the Area where the examination has been scheduled, the Service normally will agree to transfer the examination to the closest Service office in the other Area.

  2. Treas. Reg. §301.7605-1(e)(2)(ii) states that a request by a taxpayer to transfer the place of examination for field examinations will generally be granted under the following circumstances:

    1. If a taxpayer does not reside at the residence where an examination has been scheduled, the Service will agree to transfer the examination to the taxpayer's current residence.

    2. If the taxpayer's books, records, and source documents of an individual sole proprietorship (Schedule C), or a business (Form 1120, 1065, etc.) return are maintained at a location other than the location where the examination has been scheduled, the Service will agree to transfer the examination to the location where the taxpayer's books and records are maintained. See IRM 4.10.2.8.3.

4.11.29.5  (04-01-2005)
Factors Which Must Be Considered In Assessing A Taxpayer's Request

  1. Examiners should evaluate the facts as to whether the case should be transferred on a case-by-case basis. IRM 4.10.8.3 paragraph 4 and Treas. Reg. §301.7605-1(e)(1) list the factors that must be taken into account in determining if the taxpayer's examination may be transferred to another Area or POD.

4.11.29.6  (04-01-2005)
The Representative's Request For Transfer

  1. Treas. Reg. §301.7605-1(e) provides that the examiner will consider WRITTEN requests by representatives to change the place the Service has set for an examination. For case transfer purposes, "representative " means attorneys, certified public accountants, enrolled agents, officers of the taxpayer's organization, full-time employees of the taxpayer, or enrolled actuaries that the taxpayer has properly designated as their representative such as by executing Form 2848, Power of Attorney and Declaration of Representation. A "representative" also includes an unenrolled tax return preparer who prepared the taxpayer's return for the year at issue if the taxpayer has designated the unenrolled tax return preparer as their representative (e.g., by executing a Form 2848).

  2. The location of the place of business of a taxpayer's representative will generally NOT be considered in determining the place for an examination. However, if the factors outlined in Treas. Reg. §301.7605-1(e)(2) or IRM 4.10.8.3 paragraph 4 are met, the examiner has the discretion to transfer the place of examination to the representative's office.

  3. The representative must indicate he/she is in possession of the records to be examined and will make them available in an expedient manner. Transfers will not be approved for request from individuals authorized to receive tax return information through the use of Form 8821, Tax Information Authorization, requests.

4.11.29.7  (04-01-2005)
Written Requests By The Taxpayer/Representative

  1. The request for transfer of a field examination will be considered only after the taxpayer or representative submits the written statement including the following:

    1. The reason for the transfer;

    2. The taxpayer's current address and current phone number;

    3. The address/location of the taxpayer's current principal place of business;

    4. The address/location at which the taxpayer's books, records, and source documents are maintained;

    5. Sufficient information to establish that the transfer will result in an examination where the books, records, and source documents are maintained.

    6. Why the requested location is more efficient for the examination of the taxpayer;

    7. Other factors which indicate that conducting the examination at a particular location could pose undue inconvenience to the taxpayer.

4.11.29.8  (04-01-2005)
Requirements For A Case To Be Transferred Out Of Area

  1. In addition to a written request by the taxpayer or representative (as specified above), the following requirements must be present:

    1. There must be resources available at the location to which the taxpayer has requested a transfer.

    2. At the time of the taxpayer's request to transfer the return from one Area to another there must be at least 13 months remaining on the statute of limitations on assessment.

    3. Consistent with Treas. Reg. §301.7605-1(e)(4), an extension of the statute of limitations will be required as a condition for an otherwise permissible transfer if the 13 month period is not met.

    4. If the taxpayer requests transfer of a 90-day letter case to another area, the area that issued the 90-day letter determines if the case should be transferred. See IRM 4.14.17.4.4.

4.11.29.9  (04-01-2005)
Transfer Initiated By The Service

  1. An examiner may initiate a transfer of an examination if the transfer would promote the effective and efficient conduct of the examination. If the taxpayer requests that a transfer not be made, the examiner will consider the request according to the "Factors that Must be Considered " outlined in IRM 4.10.8.3

4.11.29.10  (04-01-2005)
Area Processing Guidelines

  1. Transfer cases generally need immediate attention. Good customer relations dictate getting the return and the data base to the correct location as soon as possible.

4.11.29.10.1  (04-01-2005)
Submit Case For Transfer As Soon As The Request Is Received

  1. When a transfer request is received from the taxpayer/representative, the examiner will determine if the request is allowable, and if so, immediately prepare the case for transfer. Cases will be transferred within 30 days from the date the request is granted. The receiving Area will accept or reject the transfer within 30 days of receipt.

4.11.29.10.2  (04-01-2005)
Prepare Form 3185

  1. Form 3185, Transfer of Return, will be prepared and attached to the outside of the case folder whenever the area office code will change. Use Form 3210 for all other types of transfers. Do not use both per IRM 4.4.33.5. Ensure all information is shown on the transfer form, including a legible signature of the responsible employee , current telephone number, and address. The comments section will indicate which factor was considered for the transfer. Document the date of taxpayer's request and the statute expiration date in the remarks section or in Item 6. Current Zip Code listings will be used to determine the correct receiving Area. Check the AIMS Web Site for the current Zip Code listing.

4.11.29.10.3  (04-01-2005)
Prepare Form 3198

  1. Check the "name/address change" box and insert the corrected address and phone number for the taxpayer, if applicable. Also, complete Form 2363, Master File Entity Change, (see IRM 4.11.30, Undeliverable Mail - Change of Address) if applicable, to reflect a permanent address change and enclose it in the case file.

  2. Check the "other" box:

    1. Notate "send Letter 1020" (Letter 1020 will notify taxpayers that the transfer is in progress and to anticipate contact from the receiving office for an appointment),

    2. Notate "route to Planning and Special Programs (PSP) for review prior to transfer."

    3. Indicate if the file contains a document properly designating a representative (e.g. Form 2848, Power of Attorney and Declaration of Representation.)

    4. Indicate if Form 2363 is enclosed in the case file.

  3. Check the "Special Instructions" box and indicate that the examination is being transferred and to see Form 3185.

4.11.29.10.4  (04-01-2005)
The Case File Should Include

  1. The letter from the taxpayer/representative requesting the transfer. The letter should be on top of all other papers in the case file.

  2. If the case is transferred after examination has begun, but prior to issuance of the preliminary 30-day letter, the case file should include up-to-date workpapers that set forth all facts, conclusions reached, and tentative adjustments.

  3. If the case is transferred after issuance of the 30-day letter, it should be accompanied by the complete file, any taxpayer protest, and all pertinent papers.

  4. If the taxpayer has requested a hearing with Appeals, the complete file should be forwarded to the Appeals office serving the Area in which the protest was received. The local Appeals office will transfer the case to the receiving Area Appeals office.

    Note:

    A Form 2848 designating an unenrolled return preparer as a representative does not authorize the designated individual to represent the taxpayer in front of Appeals. Taxpayers with such Forms 2848 should be advised to submit a new Form 2848 designating another authorized representative.

4.11.29.10.5  (04-01-2005)
Close The Case Through The Group Manager To PSP

  1. The group manager must approve Form 3185. After approval, the group clerk will close on ERCS to status 57, Case Processing, with disposal code 30 and flag the case to be routed to PSP for review.

4.11.29.10.6  (04-01-2005)
The Receiving Area

  1. The receiving Area will contact the taxpayer within 30 days of receipt. When a Form 2848 or other designation of representative is in the case file, the representative is notified at the same time.

  2. If it is determined after the taxpayer is contacted, that the books and records and other source documents needed to complete the examination are not available in the receiving Area, the case should be referred to the group manager for resolution. See IRM 4.10.2.8.3(8).


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