RMC No. 39-2003: Clarifies the termination and handling of audit/investigation and reinvestigation/reconsideration of tax liabilities/returns of taxpayers under the jurisdiction of the Large Taxpayers Service, Enforcement Service and Legal Service, and those handled by the various task forces

Key points

1. Limits on new LTS audit orders. The LTS issues no new Letters of Authority, Audit Notices, TVNs, Mission Orders or other written audit orders, with these exceptions: income tax or VAT refund or TCC claims and returns showing excess credits, other refund or TCC claims for erroneously paid or illegally collected taxes, one-time transaction returns under LTS, tax clearance requests due to retirement, cessation, merger, consolidation, split-up, spin-off or other reorganizations, and other cases directed and approved by the Commissioner.
2. Termination deadlines for LTS. Audits and related cases started in 2001 and prior years must be terminated and reported on or before July 31, 2003. Those started in 2002 must be terminated and reported on or before August 29, 2003. Dockets outstanding on those dates are returned to the Office of the Commissioner.
3. Enforcement Service. Cases covered by LAs issued in 2001 and prior years end on or before July 31, 2003, and those with LAs issued in 2002 end not later than August 29, 2003. Dockets of unfinished cases of the Tax Fraud Division and Policy Cases Division go to the Office of the Commissioner. The ES may recommend an LA for the Commissioner’s approval if its preliminary investigation shows prima facie evidence of fraud.
4. Legal Service. Cases handled by or referred to the Legal Service in 2001 and prior years end on or before July 31, 2003. Cases from 2002 end on or before August 29, 2003.
5. Task forces. No special task force may be created in the National and Regional Offices without the Commissioner’s approval. Cases of task forces created in 2001 and prior years, and LAs/Mission Orders from those years, end on or before July 31, 2003. Those from 2002 end on or before August 29, 2003.

Who is affected

• Taxpayers under the Large Taxpayers Service, Enforcement Service and Legal Service
• Taxpayers in cases handled by task forces

Deadlines and effectivity

• 2001 and prior years: terminate and report on or before July 31, 2003
• 2002 cases: terminate and report on or before August 29, 2003