Estimates, supported by past experience, may have to be relied on by the prospective support districts in preparing their programs with regard to support staff-days to be furnished other districts. This information database must be updated at the close of the first quarter in which direct examination time is charged to the case. This initial report, although often incomplete, will inform management that the examination has been initiated. Examination Potential A case manager may determine that a tax return for a particular cycle does not warrant examination. Numerous factors go into making such a determination.
Cost effectiveness is extremely important whether considering one issue or a full scope examination.
When a particular case does not warrant examination and there are no carryover adjustments affecting the years in question, the case should be surveyed. First when a determination is made that it is necessary to make a third party contact, but prior to making that contact, the Service must give taxpayers a notice that the Service might contact third parties with respect to collection or determination of a tax liability. Please refer to IRM 4.2, Examination of Returns Handbook, text 1.6.12 for definitions and procedural requirements. As a result of RRA 98 Sec. 3705, any manually or computer generated correspondence shall include the name, telephone number, and unique identifying number of an IRS employee who can be contacted with respect to the correspondence. The correspondence should prominently contain with the body of the correspondence, the courtesy title, last name, telephone number, and identifying number of the employee who can best answer the taxpayer's questions and resolve any subsequent inquiries.