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Part 7. Rulings and Agreements

Chapter 21. Exempt Organizations Automated Processing Procedures

Section 3. Screening, Controlling and Case Closing

7.21.3  Screening, Controlling and Case Closing

7.21.3.1  (01-01-2003)
Overview

  1. Procedures are provided on the screening, controlling and closing of cases. Combined TE/GE procedures are provided in Section 3.2.

  2. Instructions for entering applications on EDS are provided in IRM 7.22, Exempt Organizations EDS User Manual.

  3. These instructions are for personnel in the Cincinnati Submission Processing Center’s (CSPC) Receipt and Control Manual Deposit Unit and Code and Edit Unit.

  4. Applications are entered on the Letter Information Network User System (LINUS).

7.21.3.2  (01-01-2003)
EO Instructions

  1. These instructions apply to EO Determinations case processing and the personnel who perform these functions. The Receipt and Control Branch performs the initial stages of processing and perfecting the files.

7.21.3.2.1  (01-01-2003)
Manual Deposit Unit

  1. The Manual Deposit Unit assigns the Document Locator Number (DLN) and controls the application on LINUS, processes the user fees, generates the acknowledgment letters and prepares input sheets for pre-screening in the Code and Edit Unit.

7.21.3.2.2  (01-01-2003)
Code and Edit Unit

  1. The Code and Edit Unit (CEU) assembles the case file and pre-screens application packages for all required enclosures and their acceptability. The application information is entered on EDS.

  2. CEU enters the case number assigned by EDS on the determination letter request when the case is accepted by Data Transcription Subsystem (DTS). No other markings may be made on the request or its attachments during the screening and controlling process because such markings may be construed as inappropriate by the courts if the case reaches the litigation stage.

  3. CEU boxes and ships the applications via shuttle service to Centralized Files at the Determinations Primary Office (DPO) for technical processing and final determination.

7.21.3.2.3  (01-01-2003)
Processing Powers of Attorney

  1. Applications requesting EO determination letters are often submitted with a Power of Attorney (POA) attached. POAs may be submitted on—

    1. Form 2848, Power of Attorney and Declaration of Representative (POA), or

    2. Form 8821, Tax Information Authorization (TIA).

    Note:

    Forms 2848 and 8821 are made available as a convenience and their use is not mandatory. The POA or TIA can take other forms; the use of technical language is not necessary.

  2. Form 2848, Form 8821, or the document used in lieu of these forms must contain the following information:

    1. Name, EIN, and address of the taxpayer (If the EIN is not on the POA or TIA, obtain the information from the application);

    2. Name and address of the designated representative;

    3. Specific acts to be performed; and

    4. Taxpayer’s signature, either the same signature that is on the application or the signature of an officer of the organization seeking exempt status.

  3. If any of the items listed in (2)(a)–(d) are missing, process the POA or TIA as follows:

    1. If the application is complete but the POA or TIA is invalid, annotate the POA/TIA, indicating the missing information and include the invalid POA/TIA in the case file.

  4. If Form 2848 or 8821 is complete, enter the POA or TIA on the POA screen on DTS.

7.21.3.2.4  (08-01-2003)
General Disclosure Matters

  1. Contact by employees in TE/GE Customer Accounts Services (CAS) with the taxpayer will generally be limited to correspondence generated by the function and telephone inquiries related to that correspondence.

  2. Employees should not provide advice and counsel to taxpayers beyond that required to process their work. Refer any technical questions regarding the applicable principles of law and questions concerning the appeal rights of taxpayers to the designated TE/GE technical personnel or CAS Unit.

  3. Tax returns and return information, which includes applications requesting EO determination letters, are confidential under IRC 6103 and may not be disclosed except as authorized by IRC 6104. Only applications for tax exemption that result in issuance of a favorable determination letter are available for public inspection under IRC 6104.

  4. Employees are prohibited from disclosing returns or return information to unauthorized persons. The Internal Revenue Code provides that both civil and criminal sanctions may be imposed upon employees and others who violate the disclosure provisions of the Code.

  5. Contact the disclosure officer regarding any questions, problems or concerns about disclosure matters.

7.21.3.2.5  (01-01-2003)
Case Establishment

  1. Data Transcription Subsystem (DTS) is used to enter determination applications on the system before shipping case files to Centralized Files.

  2. Under normal workload conditions, applications should be screened within 10 workdays of receipt. Cases should be processed in receipt order. See IRM 7.22.4 for DTS procedures.

7.21.3.3  (08-01-2003)
Processing EO Applications

  1. This text contains general instructions for EO screening workflow and requirements. Specific instructions for DTS screening are found in Chapter 4 of this manual.

7.21.3.3.1  (08-01-2003)
Exemptions and Determinations

  1. Organizations seeking exemption (including group exemptions) from Federal income tax must submit an application for recognition of exemption to the Cincinnati Submission Processing Center (CSPC). Organizations seeking determinations on issues other than requests for exempt status may request such determinations by corresponding with TE/GE Customer Account Services (CAS). The requests are submitted on the following forms:

    1. Form 1023, Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code, is used for organizations described in IRC 501(c)(3), IRC 501(e), IRC 501(f), IRC 501(k) and 501(n).

    2. Form 1024, Application for Recognition of Exemption Under Section 501(a), is used for organizations described in IRC 501(c)(2), (4), (5), (6), (7), (8), (9), (10), (12), (13), (15), (17), (19) and (25).

    3. Form 1028, Application for Recognition of Exemption Under Section 521 of the Internal Revenue Code, is used for organizations described in IRC 521(a).

  2. Organizations may also request exempt status by submitting a letter (without a form) to CSPC. This covers requests under IRC 501(c)(1), (11), (14), (16), (18), (21), (22), (24), (26) and (27), and 501(d) and 529. These requests are entered on DTS as follows:

    1. Group exemptions are entered as Form 1026. When a central organization requests a group exemption to cover its subordinates and at the same time requests an individual exemption for itself, treat it as separate requests and enter it under the EIN of the central organization.

    2. All other letter requests are entered as Form 1025.

7.21.3.3.2  (08-01-2003)
Processing Amendments

  1. After receiving exempt status, an organization is advised to inform TE/GE Customer Account Services (CAS) of any changes in its purposes, character, name, or method of operation.

    1. An organization that amends its enabling instrument (e.g., corporate charter, trust instrument, or articles of organization), or internal regulations (e.g., bylaws), should submit a conformed copy of such amendments to CAS.

    2. An organization that files Form 990, Return of Organization Exempt From Income Tax, or Form 990-PF, Return of Private Foundation Exempt From Income Tax, should submit a conformed copy of such amendments with the return if not previously submitted.

    3. Amendments received in EO Technical or processing centers will be referred, without consideration, to CAS.

  2. CAS will screen all amendments to determine if action by an EO Determinations group is required.

    Note:

    Amendments to the governing instrument which do not affect the organization’s exempt status will not be forwarded to the group or controlled on ICS. Examples of changes that generally do not affect the organization’s exempt status include changes in the number of directors, trustees, officers, or their respective duties, accounting period, name, address, or other similar changes.

  3. If the amendments represent changes that clearly do not affect the organization’s exempt status, CAS will:

    1. Acknowledge receipt of the amendment if it involves more than a change of address or accounting period.

    2. Associate the amendment with the administrative file, and

    3. Prepare Form 2363-A, Exempt Organization/BMF Entity Voucher, for name and address changes.

    Note:

    Amendments for change of address or change in accounting period do not require acknowledgment.

  4. Where it is clear the amendments may affect the organization’s exempt status, CAS will:

    1. Associate the amendments with the administrative file,

    2. Send to CSPC for input to LINUS, and

    3. Update ICS status 50 to reflect Area Office receipt.

  5. Where it is unclear whether the amendments may affect the organization’s exempt status, CAS will hold the amendments for an EO technical screener to make the determination. At least weekly, CAS will notify the EO technical screener if cases are being held for their assistance.

  6. If it is necessary to correspond with the organization for conformed copies of bylaws or articles, CAS will initiate a letter to the organization requesting a conformed copy.

    1. Keep a copy of the letter and the documents submitted by the organization in a suspense file.

    2. If a conformed copy is not received from the organization after 30 days, send to CSPC for input to LINUS to transfer the case to ICS and forward case to the EO group.

    3. Assign the control date as the date received.

  7. If the amendments cause a change in the exempt status of the organization, CAS will issue a letter relative to the effect of the amendment. This constitutes a determination letter.

    1. The letter will indicate the date of the original ruling or determination letter and the EIN, and offer appropriate appeal rights.

  8. If the amendment changes the name of the organization, copies of the amended articles of incorporation (if incorporated) or copies of the amended constitution and/or bylaws (if not incorporated), authorizing any change in name must be with the file before action is taken to change Service records.

    1. A letter issued, in this instance, should show both the present and former name of the organization as well as the date of the original ruling or determination letter and the EIN.

  9. Rev. Proc. 80-27, 1980-1 C.B. 677, requires that the central organization that holds a group exemption letter submit information annually to the Ogden Campus (previously known as the Ogden Service Center). The information reports additions, deletions, and changes in purposes, character, or method of operation of subordinate organizations which are covered by the group exemption.

    1. If the annual list is submitted to EO Determinations, EO Technical, or CAS, it should be forwarded to the Ogden Campus, and the central organization should be advised accordingly.

    2. All EO/BMF updates resulting from these annual listings will be prepared by the Ogden Campus.

  10. When an organization covered by a group exemption letter (the central organization or a subordinate) amends its enabling instrument or internal regulations, submit two copies of the amendments to CAS. Handle these amendments as prescribed in (5) above.

  11. Federal credit unions are included in a group exemption ruling issued to the National Credit Union Administration (NCUA), which is the central organization.

7.21.3.3.3  (01-01-2003)
Advance Ruling

  1. When an advance ruling is issued, the EDS closing document will contain a 6-digit number representing the year and month in which the foundation status is scheduled to terminate.

    Example:

    A June 30, 2002, expiration date is reflected as 200206. The EO specialist should generate a duplicate copy of the closing document which is to be retained by TE/GE Adjustments in a tickler file.

  2. If TE/GE Adjustments has sufficient storage space, retain the administrative file for follow-up purposes. Otherwise, TE/GE Adjustments should retain one copy of the advance ruling letter (Letter 1045(DO/CG)) in a suspense file for follow-up purposes. A similar manual suspense system or computerized suspense system in lieu of the Letter 1045(DO/CG) suspense may be used.

  3. The TE/GE Processing should profile an individual or individuals in TE/GE Adjustments to access EDS Letter Generation.

    1. Between 30 and 45 days before the last day of an organization’s advance ruling period (e.g., between November 15 and December 1 for calendar year organizations), prepare Letter 1046(DO/CG) for organizations that have not received a final determination of private foundation status.

    2. Mail the original letter to the organization and associate a copy of Letter 1046 with the advance ruling letter.

  4. After the follow-up letter is mailed, hold the Advance Ruling Follow-up Suspense File pending a reply.

    1. When the organization submits the requested information, the administrative file is pulled and the case is sent to CSPC for input to LINUS and established as a type "F" request (private foundation follow-up).

    2. Update the ICS record to "assigned status" according to local instructions.

  5. If the organization does not submit the requested information within 105 days from the end of its advance ruling period, TE/GE Adjustments will:

    1. Prepare Letter 1048(DO/CG).

    2. Prepare Form 5060, Report of Adverse Determination on Private Foundation Status and Private Operating Foundation status.

    3. Prepare Form 2363-A to update the EO/BMF.

    4. Set the file aside for review and approval by an EO technical employee. If approved, the letter will be signed, dated, and mailed to the organization.

    5. Associate the copy of Letter 1048(DO/CG), Form 5060, and Form 2363-A with the copy of the advance ruling and follow-up letters.

  6. Hold Forms 5060 and 2363-A for 60 days.

    1. If the organization does not respond by the end of the 60-day period, research the file to confirm that a response was not received.

    2. If a response was not received, send the Form 5060 to the EO Technical, input Form 2363-A information on IDRS and associate copies of all documents with the administrative case file.

  7. If the organization submits the requested information, or asks that its presumption as a private foundation be reconsidered during the 60-day period, send to CSPC for input to LINUS as a type F (private foundation follow-up) request.

    1. If Form 5060 has been sent to the EO Technical before the requested information is received, do not prepare a new or amended Form 5060. Prepare Form 2363-A and input to IDRS.

7.21.3.3.4  (01-01-2003)
Screening Criteria

  1. The screener will determine, applying the criteria listed, whether each application includes the specific data or financial information, as provided below.

    Note:

    Screeners are not responsible for determining whether an individual has the authority to sign the application (e.g., a signature on page 1). Screeners also are to accept the information regardless of the apparent comprehensiveness or content.

  2. If the organization has not yet commenced operations, a proposed budget for two full accounting periods.

  3. If the organization has commenced operations but has been in existence less than one year, a proposed budget for two full accounting periods and a statement of receipts and expenditures and a balance sheet for the current year.

  4. If the organization has commenced operations and has been in existence for more than one year, a statement of receipts and expenditures and a balance sheet for the current year, and the three immediate prior years (or the years the organization was in existence, if less than four years).

  5. A copy of the organizational document. This includes:

    1. A certification of incorporation approved and dated by an appropriate State official, or a copy of the articles of incorporation accompanied by a written declaration signed by an authorized individual that the copy is a complete and accurate copy of the original copy that was filed and approved by the State. If a copy is submitted, the declaration must include the date the articles were filed with the State, or

    2. A constitution, articles of association, or any other organizing document signed by two individuals and dated, or

    3. A trust instrument.

  6. If the organization is a corporation, a copy of the bylaws or similar rules of operation must either be attached, or a statement must be attached that there are none.

    Note:

    Bylaws do not have to be signed if they are accompanied by a properly signed application or cover letter. If an organization is other than a corporation, the screener will not reject the application due to the lack of bylaws.

  7. Includes a description of past, present and proposed activities, on page 2 of the application, or as an attachment.

  8. Includes a check in one of the boxes on page 1 of Form 1024 to indicate the code section applied for, and a completed schedule for the applicable code section. (If the screener can identify the code section requested based on a completed schedule, accept the application even if no box is checked).

7.21.3.3.5  (08-01-2003)
EO Case File Assembly

  1. An administrative case file will be established for each complete application received. This file will be comprised of the application and supportive documents, and other materials outlined in the following sections.

  2. The contents of the administrative case file are divided into two basic categories:

    1. Information which may be open to public inspection (under IRC 6104) on the right side, and

    2. Information not open to public inspection on the left side.

7.21.3.3.5.1  (08-01-2003)
Material Open to Public Inspection

  1. The right side of the file contains all information generally open to public inspection in the following descending order:

    1. Most recent Case Closing Sheet (Form 8671),

    2. Determination letter or letters,

    3. Power of Attorney (if filed),

    4. Consent Fixing Period of Limitations Upon Assessment of Tax under IRC 4940 (if filed),

    5. Application form and any amendments, revisions, or re-applications,

    6. Original enabling instruments and any amendments,

    7. Financial information (not submitted as an integral part of the application form),

    8. Documentation of nondiscriminatory policy (if application is from a school),

    9. All disclosable schedules or statements submitted as part of applications,

    10. Correspondence received from the organization or issued to the organization pertaining to the determination of the exempt status, and

    11. Printed material, publications, etc., submitted as part of the application.

7.21.3.3.5.2  (01-01-2003)
Not Open to Public Inspection

  1. The left side of the file contains all information generally not open to public inspection in the following descending order:

    1. Form 8326, Transmittal Sheet, and/or Form 5464, Case Chronology Record (if used),

    2. Copies of EO/BMF Entity Vouchers,

    3. Copies of examination reports that may affect subsequent years,

    4. Determination work papers (Form 6038 will be the first page of the work papers),

    5. Reviewer’s memorandum and other Service memorandums or reports, including Form 5402, Appeals Transmittal Memorandum and Support Statement,

    6. Trade secrets, patents, etc., determined to be not open to public inspection, and

    7. Copy of user fee check.

7.21.3.4  (01-01-2003)
Input to DTS

  1. In general, requests will be processed in the order received.

7.21.3.4.1  (01-01-2003)
EO Exceptions

  1. EO written requests for expeditious treatment which have been approved by the EO Determinations Manager or his/her delegate will be given priority treatment. Generally, priority treatment will be given in the following circumstances:

    1. When a grant to the applicant is pending and the failure to secure the grant may have an adverse impact on the organization’s ability to continue operations;

    2. When the purpose of the newly created organization is to provide disaster relief to victims of emergencies such as flood and hurricane;

    3. When problems within IRS have caused undue delays in issuing a letter; and

    4. In any other situation where the EO Determinations Manager or his/her delegate determines that expedited service is warranted.

7.21.3.4.2  (01-01-2003)
EO Resubmitted Applications

  1. When an organization reapplies for a determination letter, the entry for type request on DTS will be determined as follows:

    1. Establish as Type Request "S" a case previously closed FTE (closing code 11, or a church with closing code 12) that is resubmitted before the 90-day period (plus extensions granted) user fee waiver has expired.

    2. Establish as Type Request "I" all other cases that are resubmitted, i.e., formerly closed 02, 08, 12 (other than church FTE), or 11 (after the user fee waiver period has expired), and require payment of a new user fee.

7.21.3.4.3  (01-01-2003)
Control Date

  1. The Control Date which must be manually entered on DTS is an 8-digit number written in the format MMDDYYYY.

    Example:

    The date July 4, 2002, will be entered as 07042002.

    Note:

    Exercise extreme care in entering this item. This date is used to determine the age of the inventory and to start the running of the declaratory judgment period; it cannot be corrected by the screener after exiting the screen.

  2. The control date is determined as follows:

    1. If the application was mailed to the Service, properly addressed, enter the postmark date. If the postmark is illegible, enter the date which is five calendar days before the date of actual receipt, as evidenced by the date stamp. However, the control date may never be earlier than the date the application was signed or the date of the cover letter (if the cover letter date is later than the date the application was signed).

    2. If the application was sent by certified or registered mail, enter the date of certification or registration.

    3. If the application was delivered to the Service by other than mail, enter the date of actual receipt as evidenced by the date stamp.

    4. The control date for an application which was rejected as incomplete is the date the completed application was postmarked or received, if not mailed.

    5. The control date for an application previously closed for which additional information is received, will be the date of the postmark on the envelope containing the additional information.

    6. If an application is not received within a reasonable period of time from the date of postmark (5 days), enter the date of actual receipt, as evidenced by the date stamp.

7.21.3.5  (01-01-2003)
Complete Applications

  1. DTS automatically updates the status of EDS records for established cases to status 50 (Area Office receipt) on the EDS Inventory Control Subsystem (ICS).

  2. Forward all application to the technical screener(s).

7.21.3.6  (01-01-2003)
Processing Incomplete

  1. The Letter 1042(DO/CG) is used to correspond to taxpayer for missing application data.

  2. All applications are accepted. The technical screener will determine if an application will be returned to the applicant.

  3. If a valid POA is on file and specifies that correspondence is to be returned directly to the authorized representative, return the incomplete application to the authorized representative. Send a courtesy copy of Letter 1042(DO/CG) to the applicant.

  4. If a valid POA is on file, but does not indicate that correspondence should be sent to the representative, return the incomplete application to the applicant with a courtesy copy of Letter 1042(DO/CG) to the representative.

  5. If no POA is on file, return the incomplete application to the applicant.

  6. If Letter 1042(DO/CG) with the incomplete application is returned as undeliverable, an attempt should be made to locate a new address by researching EDS, IDRS, or the administrative file (if any).

7.21.3.7  (01-01-2003)
General Closing Procedures

  1. Cases are closed on ICS in Determinations Groups or Quality Assurance.

    1. Completed cases pending the 30-day user fee hold will be stored for EO cases in designated area.

    2. Completed cases are date stamped and mailed.

  2. Types of cases transmitted to Quality Assurance directly from the Determinations Group(s):

    1. Mandatory review cases.

    2. TE/GE Quality Measurement System (TEQMS) (which has replaced the sample review program) cases. These cases are computer-selected when they are approved on the Manager Approval Screen in ICS.

  3. Before transferring cases selected for TEQMS review to Quality Assurance, place the TEQMS tally sheet in the case file or otherwise indicate the case is a TEQMS case.

  4. The TE/GE Records Unit should not receive any mandatory review cases before the review staff has approved the actions taken by the EO specialist. If a case has been misdirected to the TE/GE Records Unit, notify the manager immediately.

  5. The following cases are mandatory review cases:

    1. Impact cases (controversial issue involved, regional or national impact, may cause widespread adverse publicity for Service, etc.);

    2. Technical advice or assistance requests;

    3. Private and public school determination cases;

    4. Mandatory Post Review cases;

    5. Cases subject to IRC 6110 (Disclosure), except for IRC 1402(e) Church Status Determinations;

    6. Cases identified for mandatory review by the group manager;

    7. Health care organizations that are integrated delivery systems; hospitals where physician practices or physician facilities (e.g., MRI, ambulatory surgery center) are purchased, or compensation is based on net profits or earnings; hospital management service organizations; preferred provider organizations; physician hospital organizations; health maintenance organizations; and managed care purchasing organizations (i.e., established by hospitals, employers, insurance companies, physician groups, and community representatives to fix health care rates and enroll participating employers);

    8. Cases involving a proposed adverse determination of qualification under IRC 501(c)(3) or IRC 170(c)(2);

    9. Cases involving a proposed adverse determination of qualification of classification as a private foundation described in IRC 509(a) or as an operating foundation described in IRC 4942(j)(3);

    10. Farmers cooperative;

    11. Approved group rulings and declination cases;

    12. Bond financing;

    13. Previously revoked organizations;

    14. Religious and apostolic organizations under IRC 501(d);

    15. Exempt operating foundations under IRC 4940(d);

    16. Foreign organizations;

    17. Organizations that reference home schooling as an activity;

    18. Approved cases under any subsection in which the exempt organization is in a partnership agreement; and

    19. Cases involving final adverse determination of qualification under sections other than IRC 501(c)(3).

  6. When closing a case if Form 5666 is in the file, forward the original and a copy to the appropriate personnel.

  7. The Determinations Group(s) will ensure that the letters are date-stamped and signed before mailing. Distribute copies as follows (if applicable):

    1. Original to the organization;

    2. Copy to the power of attorney;

    3. Copy to the administrative file; and

    4. Two copies for State notification.

7.21.3.7.1  (01-01-2003)
Adverse Determination

  1. If the organization files an appeal of a proposed adverse determination, prepare Form 3210, Document Transmittal, to send the case to Appeals.

  2. Do not process Form 2363-A, Exempt Organization/BMF Entity Vouchers, until the organization has exhausted its administrative appeal rights and a final determination concerning exempt status has been made.

  3. In the case of a final revocation involving an IRC 501(c)(3) organization, the Determinations Group(s) must issue a letter notifying the appropriate State officials of the action taken in accordance with IRC 6104(c) and the applicable regulations.

7.21.3.7.2  (08-01-2003)
Forwarding Cases to EO Technical

  1. Cases should be updated to status 58 and forwarded to EO Technical. Each determination group will use Form 3210 to forward the case files, as follows:

    1. For IRC 501 cases, send the original and one copy of Form 3778 with the case file to EO Technical (T:EO:RA:T).

    2. For IRC 521 cases, send the original and one copy of Form 3778 with the case file to EO Technical (T:EO:RA:T).

    Note:

    EO Technical forwards IRC 521 cases to Associate Chief Counsel, Passthroughs and Special Industries (CC:PSI).

  2. When transmitting the file of an organization applying for recognition of exemption, include the cover or envelope in which the application was mailed to the Cincinnati Submission Processing Center in the file.

  3. When a cooperative (IRC 521) is forwarded to the EO Technical, update the case to status 37 (suspense) before forwarding the case to EO Technical.

  4. A copy of Form 3778 may be furnished to the Area EO Examination Manager if requested.

  5. EO Determinations personnel will prepare an original and one copy of Letter 996(DO/CG), Acknowledgment Letter, according to instructions and forward the case file to EO Technical. Letter 996(DO/CG) will not be mailed to the taxpayer prior to mailing the case to EO Technical.

  6. After EO Technical completes an exemption application case, it will send the entire administrative file to EO Determinations Centralized Records.

  7. After EO Technical completes a ruling letter case, it will retain the administrative file. A copy of the ruling letter will be sent to EO Determinations Centralized Records.

7.21.3.7.3  (08-01-2003)
State Official Notification

  1. IRC 6104(c) provides for notifying appropriate State officials of certain determinations made by the Service which adversely affect IRC 501(c)(3) organizations. It also identifies the State officials who are entitled to notification and inspection of various returns and other documents.

    1. Reg. 301.6104-3 provides further information concerning which State officers are entitled to notification, the material which may be inspected, and the conditions for inspection.

    2. EO personnel will identify State notification cases by writing "State Notification Case" in the " other" block on Form 3198, Special Handling Notice, attached to the front of the case file. The file will include a list of the states to be notified and which forms or letters to send.

  2. When the Appeals Office closes agreed cases involving a tax deficiency under section 507 or Chapter 41 or 42 of the Code, and the cases are transmitted to the respective Determination Group for closing, "State Notification Case" and the name of the states to be notified as well as which forms or letters to send will be entered on Form 3210 by Appeals.

  3. Centralized Files will accumulate and forward information to appropriate State officials on a monthly basis.

  4. A transmitting cover letter will be prepared stating that the copy of the determination letter is provided for the information of the State official in accordance with IRC 6104(c). One cover letter may transmit more than one case. Make certain that all names are included in the cover letter for those cases being transmitted.

    1. The names of the cases will be listed under identifiable headings such as Adverse Determination, Section 507 Tax Deficiency, Chapter 41 Deficiency, Chapter 42 Deficiency, dissolving organizations, Failure to Furnish Information, and Failure to Have Operating Experience.

    2. The cover letter should advise that all requests to inspect material (concerning both field and EO Technical determinations) be sent to the office that issued the automatic notification.

    3. The letter should include the following statement:

    " Requests for inspection of material pursuant to section 6104(c) must be accompanied by the following statement: As provided by section 6104(c) of the Internal Revenue Code of 1986 and the applicable regulations, I hereby request that you make available for inspection and/or copying, IRC material and information relating to the final determination of (type of determination) to the (name of organization). Under penalty of law, I hereby declare that I intend to use such material solely in fulfilling my function under State law relating to organizations of the type described in section 501(c)(3) of the Code."

  5. The current names and addresses of officials in each State who are entitled to receive information under IRC 6104(c) are identified in Exhibit 7.12.2-1. EO Technical will promptly notify Centralized Files of any changes in the list of State officials.

  6. Retain copies of transmittal letters for two years.

7.21.3.8  (08-01-2003)
Post Review of EO Determinations

  1. To ensure uniform application of the law and Service procedures, EO Technical will perform a post review of certain determination letters issued by EO Determinations.

7.21.3.8.1  (08-01-2003)
Procedures

  1. Procedures for forwarding cases to EO Technical for post review are as follows:

    1. Using Form 3210, Document Transmittal, EO Determinations will transmit copies of determination case files after the EO determination letter is issued, for determinations issued during the month to organizations selected for EO Technical post review.

    2. Form 3210 should be completed as follows:

    • Enter case name.

    • Enter brief statement of the reason(s) for EO Technical post review.

7.21.3.8.1.1  (08-01-2003)
Cases Selected for Post Review

  1. Current cases selected under the post review program are as follows:

    1. All elementary and secondary private school determination cases where the organization is located in Mississippi or Louisiana. See IRM 7.20.3 for additional information regarding the post review program.

    2. Other cases where the Director, Rulings and Agreements, agrees to perform a post review of EO Determinations cases based on a request in writing from the Manager, EO Determinations.

7.21.3.8.1.2  (08-01-2003)
Forwarding to EO Technical

  1. A copy of each administrative file is transmitted within five workdays after the end of the month via Form 3210 to EO Technical to the attention of T:EO:RA:T. The administrative files will be charged out to EO Technical Post Review.

7.21.3.8.1.3  (08-01-2003)
Completion of Post Review

  1. The administrative files for a particular Area Office which are "Approved," "Approved with Advisory," or "Disapproved" will be returned to EO Determinations under a single transmittal memorandum. A separate memorandum containing advisory information will be supplied for each file to which the information pertains.

    1. Administrative files which are "Approved " will be returned to files when returned to the Area Office by EO Technical.

    2. Administrative files which are "Approved with Advisory" or "Disapproved" should be routed to the appropriate technical personnel for necessary action when returned by EO Technical. The charge-out of the administrative file should be updated when the case is returned by EO Technical.

    3. When directed by appropriate technical personnel, the screener must re-open certain post reviewed cases on DTS as type request "R" .


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