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CCH® PENSION AND BENEFITS — 7/20/06

IRS EP is scheduling examinations for nonparticipants in global tax shelter settlement

Employee plans that did not volunteer to participate in the IRS's global tax shelter settlement initiative will be hearing from the government, Michael Julianelle, Director of Examinations for IRS Employee Plans (EP), announced in the Summer 2006 edition of Employee Plans News. Julianelle said that EP will be setting up examination appointments.

The Global Settlement Initiative (GSI) was launched by the IRS with Announcement 2005-80 (see CCH Pension Plan Guide ¶17,097S-75 ), which outlined settlement procedures for taxpayers involved in abusive tax transactions, including some involving employee benefit plans. EP then sent letters to taxpayers with identified abusive schemes eligible for the settlement, Julianelle explained. GSI closed on January 23, 2006.

Affected taxpayers that did not use GSI should expect appointments with IRS

"For the ones that did not take advantage of the global settlement initiative, we will be setting up examination appointments," Julianelle said.

EP is also identifying additional abusive transactions, according to Julianelle. "The IRS's Large and Mid-Size Business (LMSB) and the Small Business/Self-Employed (SB/SE) Divisions are working with us to identify and put a stop to these abusive schemes," Julianelle said.

According to Julianelle, processing taxpayer requests to participate in the global settlement initiative is a "top priority." EP is also "focusing our attention on those who had the opportunity to come forward but did not," he added. The IRS is directing taxpayers to its "Retirement Plans Community" web page, at www.IRS.gov, for information regarding what to do if an abusive tax shelter scheme is discovered. The information is available by clicking "Examinations/ Enforcement," then "EP Abusive Tax Transactions."

For more information on this and related topics, consult the CCH Pension Plan Guide.

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