Saturday, July 2, 2016

IRM Guidance on Processing SDOP - On Flagging Returns for Scrutiny and IRM Redactions (7/2/16)

In a prior posting in 2014, I discussed some internal guidance on the IRS web site for processing Streamlined Submissions.  New IRS Internal Guidance on Processing Streamlined Submissions (8/29/14; 8/30/14), here.  A reader of the Blog, Andrew Jones, here, advised me that the IRS has taken down the link to the guidance and incorporated some of the guidance, with some modifications, in IRM  (05-01-2015), Adjusting Streamlined Filing Compliance Domestic Accounts - (Streamlined Domestic Offshore - SDO), here.  I have revised that prior blog entry to so indicate.

Andrew also noted that a key part of the guidance as I had posted it in 2014 related to flagging the presence of "5 or more information returns" in SDOP submissions appears to have been redacted in IRM (linked above). but Andrew recounts his sleuthing on this issue and significance of the redaction as follows:
I was spending some time working up some advice for a client re: the "5 or more information returns" metric imposed on Streamlined Domestic filings (maybe SFOP too).  I was stumped for some time because I couldn't find that language that you cited at   
When I visited the IRS' posting of the IRM (, that phrase was nowhere to be found.
I was finally able to discover that the IRS has redacted this detail (you'll find the === notations obscuring the original text, right below the line, "Allow the adjustment notices to generate and serve as the closing correspondence."  That position in the IRM is exactly where your blog post cited, and the May 1, 2015 date of the section posting to the IRM is also after the posting date of your blog entry which mentioned that language. 
I'd tend to think that anything which the IRS decides - after the fact - to redact, is probably of some significance.  In that case, you seemed to feel (and I definitely agreed) that this was an important insight into how/why Streamlined filings are or are not accepted as filed.  In the context of what is otherwise a largely 'black box' process, the IRS' efforts to hide their rules-of-thumb is particularly valuable.
Thanks to Andrew for calling it to my attention so that I can pass it on to readers of this blog.

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