Purpose: This IRM provides guidance to Field Collection employees for summons activity related to Abusive Tax Avoidance Transaction (ATAT) cases.

Audience: The audience for this guidance is revenue officers in SB/SE Field Collection.

Policy Owner: Director, Collection Policy, SB/SE.

Program Owner: Collection Policy, SB/SE, Global Strategic Compliance, is the program owner of this IRM.

Primary Stakeholders:. The primary stakeholders are SB/SE Field Collection.

Program Goals: The goal of the Abusive Tax Avoidance Transactions (ATAT) collection program is to identify and effect tax administration on cases involving complex transactions or multiple/layered entities intended to make it difficult to trace a taxpayer’s assets and sources or transfers of income.

Contact Information:. Email recommendations and suggested changes to this IRM to the Content Product Owner. The owner is indicated on the Product Catalog Information page which is found on the Forms/Pubs/Products IRM listing of the Media and Publications website.

This IRM section addresses summons issues that are commonly found in Abusive Tax Avoidance Transactions (ATAT) cases. ATAT case work often requires the use of third-party summonses to investigate and establish ownership of assets and income streams.

When serving a summons on a taxpayer or third party in collection cases involving ATAT issues, follow procedural guidance outlined in IRM 25.5, Summons Handbook, and IRM 5.17.6, Summonses, for basic legal concepts regarding the use and enforcement of administrative summonses. Managerial approval is required on all third-party summonses. See IRM 25.5.1.2.3 , Authority to Issue Summons Requiring Approval (except John Doe Summons), for additional information.

The requirements of IRC 7602(c), Notice of contact of third parties, must be met prior to issuing a summons to a third party. See IRM 25.27.1, Third Party Contacts - Third Party Contact Program, for procedural requirements and exceptions.

A third-party summons can be served to obtain information from any person deemed proper, including, but not limited to, banks and other financial institutions, real estate and escrow companies, internet access and service providers (to the extent allowed by the Electronic Communications Privacy Act of 1986), e-commerce entities, utility, or other service organizations, and to obtain the testimony of trustees and other fiduciaries. IRM 25.5.2 Exhibits provide specific wording to include on the body of Form 2039, depending on the type of information needed. Additional information that may be helpful in preparing Form 2039 can be accessed on the Collection Summons Knowledge Base at https://irsgov.sharepoint.com/sites/ETD-KMT-KB053.

Coordination with Examination -

If there are existing unpaid assessments, a summons for information can be issued if the requested information is to aid in the collection of the assessment. IRC 7602(d) limits the authority of the IRS to issue summonses when there is a Department of Justice referral, so ensure coordination with Examination and Criminal Investigation (CI). The summoned information obtained can be shared and used by other divisions of the IRS in most cases but there are exceptions. See IRM 25.5.6.5.2, Sharing Information Obtained by a Collection Summons With IRS Personnel Conducting Examinations or Criminal Investigations, for a detailed explanation.

ATAT taxpayers may raise a defense against an issued summons citing their rights against self-incrimination under the Fifth Amendment to the Constitution. This defense is not necessarily applicable in every case and when raised, the revenue officer should contact Area Counsel for guidance on the application of the constitutional argument to a specific situation. See IRM 5.17.6.10 , Constitutional Defenses, for additional discussion of constitutional defenses.

Taxpayers may raise other privilege defenses against an issued summons. Contact Area Counsel through Advisory on the application of such privilege claims. See IRM 5.17.6.2 through IRM 5.17.6.16.

A taxpayer or its representative may request to make a recording of the proceeding. Advance notice must be given at least 10 calendar days prior to the proceeding and is restricted to an audio recording. The revenue officer must also record the meeting. See IRM 5.1.12.3, Recording Taxpayer Interviews , for procedure.

The exception to notice requirements for a third-party summons issued to aid in collection of an assessed liability generally includes summonses issued to investigate a fraudulent conveyance or nominee/alter ego situation. Summonses issued to determine if transferee liability should be asserted are not exempt from third party summons notice requirements. See IRM 25.5.6.5.1, Scope of the Exception For Summonses Issued in Aid of Collection, for additional information.

The revenue officer should document the case file with the facts that support the position that a nominee or alter ego situation exists. The documentation should clearly state the nexus relationship that exists between the taxpayer and the information summoned. If there is a question regarding nexus, contact Area Counsel.