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of litigation to determine an appropriate project settlement
offer. Upon determination of the project settlement offer, the
terms of the offer are reported to the Tax Shelter Branch in the
National Office for dissemination to Internal Revenue Service
field offices (particularly the examination and appeals
functions) throughout the country to ensure that similarly
situated taxpayers are treated consistently.
Once a tax shelter project is assigned to a particular
District Counsel office, that office has the authority to settle
any individual case in the project. District Counsel generally
is expected to adhere to the official project settlement offer.
Nevertheless, District Counsel has the authority in special
circumstances to settle individual tax shelter project cases on a
basis different from the project settlement offer. For example,
District Counsel could deny a project settlement offer to the
shelter promoter or a participant who had helped to market the
program. In addition, District Counsel might eliminate an
addition to tax (such as negligence) because of the participant's
lack of education or sophistication in financial matters.
District Counsel can alter or modify an official project
settlement offer without prior approval of the National Office.
However, District Counsel is required to notify the Tax Shelter
Branch of any change or modification to the official project
settlement offer in order to allow the Tax Shelter Branch to
disseminate the revised offer to Internal Revenue Service offices
throughout the country.
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