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In its business plan, 1994 Priorities for Tax Regulations and Other Administrative Guidance, the IRS listed 134 proposed projects, over 50% of which focused on employee benefits, international issues, tax accounting and tax administration (the 1993 list included 290 projects). The 1995 list is expected to be issued by the end of January. Such lists are useful because they allow businesses to know in advance what IRS regulations and projects are forthcoming, giving their CPAs a chance to plan accordingly.
IRS ROADMAP
The IRS has a number of both new and ongoing programs.
Market segment specialization program (MSSP). In 1993, the IRS developed a program to provide guidance for IRS agents in highly specialized areas ranging from commercial fishing in Alaska to scrap metal. The IRS's objective is to develop "cookbooks" for specific markets and industries. Under MSSP the manuals are to provide detailed discussions of the industries, suggestions for conducting audits of businesses in each industry and a list of industry issues.
In February 1994, the IRS published a list of the guides it will publish (see exhibit 1, page 33). Approximately 90 markets are listed, some as broad as commercial banking or the entertainment industry, others as narrow as the Port of Houston. The list also centers on small business taxpayers--including barber shops, pizza parlors and taxicabs.
As of December 1994, the IRS had issued eight comprehensive market manuals, with the remaining manuals to be issued in 1995. The guides can be ordered by writing to the IRS, Freedom of Information Reading Room, P.O. Box 795, Ben Franklin Sation, Washington, D.C. 20044. Payment should be in the form of a check or money order payable to the IRS. Prices of specific MSSP guides can be obtained by calling (202) 622-5164.
Coordinated issues. In the 1970s, the IRS developed a formal audit plan for large corporate taxpayers--the coordinated examination program (CEP). CEP in turn developed an industry specialization program in 1979, that includes IRS specialists throughout the country who are responsible for specific industries.
As part of the program, coordinated issues (tax issues peculiar to an industry) were developed and approved by the IRS national office and the relevant industry specialists. All coordinated issues are documented in publicly available position papers. IRS agents always...