Life Cycle of a Private Foundation - Examination Procedures |
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Audit techniques for conducting examinations of tax-exempt organizations are field, office and correspondence/ OCEP (Office Correspondence Examination Program). Field examinations of large, complex organizations that require a team of specialized revenue agents, as well as coordination between IRS functions and other governmental agencies, are conducted using team audit procedures. The appropriate audit technique for each case is based on the potential issues, the scope of the examination, and the most effective way to gather required information. Generally, group managers are responsible for determining the appropriate audit technique.
The examiner may contact third parties (for example, a bank, a government agency, or employees) in situations where organizations are unable to provide information, or information provided requires verification. Such contacts generally involve providing limited information to the third party, such as the organization's name. The law prohibits the IRS from disclosing any more information than is needed to obtain or verify the information sought. The IRS must notify the organization when it makes third party contacts, and organizations may request a list of those contacted.
For a discussion of appeal procedures for unagreed issues in exempt organizations cases, see Publication 892.
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Page Last Reviewed or Updated: March 09, 2009