The following procedures provide direction for the preparation, review, approval, and reporting of CIPs, as well as guidelines for extensions, modifications, and terminations.

Language in the CIP authorization request must be specific. Blanket language and broad, undefined coverage are not acceptable. The authorization should specifically identify the market segment and the potential area(s) of noncompliance.

For purposes of recording and accessing CIPs in a national database, a naming convention should be used for titling projects. The convention is [Function - Project Code - primary issue(s) or market segment (if available) - CIP Type - Completion Date]:

The market segment should not be taxpayer specific.

Form 13502, Compliance Initiative Project Authorization - Part One, requests approval for a CIP. It is hereinafter referenced as Part One CIP in this IRM.

In the following circumstances the authorization request may be limited to Part One CIP only:

Form 13498, Compliance Initiative Project Authorization - Part Two, is used to request approval for a Part Two CIP Authorization. It is hereinafter referenced as Part Two CIP in this IRM.

A Part Two CIP Authorization request contains all the information required of a Part One. A Part Two is requested when there is a documented, demonstrated level of non-compliance. It is not necessary for a Part Two to be preceded by a Part One.

Minor modifications may be made to CIPs. The modifications should be documented by notation or addendum to the original authorization request. The approver of the original authorization should be notified. Examples of minor modifications include:

Minor modifications must not change the intent of the original CIP.

Major modifications, those that change the intent of the original CIP, require the submission of a new authorization request (refer to IRM 4.17.4.3.5, Review Concurrence and Approval Part One CIP Only for Part One CIP and IRM 4.17.4.4.4, Review, Concurrence and Approval Part Two Authorization Requests for Part Two CIP and IRM 4.17.1.1, Overview for TE/GE specific IRMs). Examples include:

If it is necessary to extend a project beyond the project completion date, approval is required. The extension must be approved at the level of the official approving the original CIP. A CIP is approved for extension in the “extension of time” section on the original authorization document (Form 13502, Part One, or Form 13498, Part Two CIP).

No extension is needed to complete project returns already in process at the project completion date. For the purpose of IRM 4.17 returns already in process include returns where the taxpayer has been contacted, or primary returns authorized by the project already updated to AIMS status 10 or above. IRM 4.17.4.7,, Project Termination and Report.

Operating Unit Specifics

CIPs should be terminated prior to the authorized project completion date by completing the termination report when any of the following conditions have been met:

A termination report, Form 13497, Compliance Initiative Project Authorization - Termination Report, must be submitted within 60 days after the project completion date including extensions, per the authorization.

The termination report will be prepared by the CIP coordinator and signed by the approver of the CIP outlined in IRM 4.17.4.3.5Review, Concurrence and Approval of Part One CIP Only or IRM 4.17.4.4.4Review, Concurrence and Approval Part Two Authorization Requests.

If a Part One CIP is expanded to a Part Two CIP, (due to the results derived in the Part One CIP Authorization request) then the Part One CIP is considered automatically terminated and no report is needed.

CIP inventory AIMS status 10 or above at the project completion date, or date a termination report has been approved (whichever is earlier), should be updated with Aging Reason Code 29 (CIP Cases Closed After Issuance of Termination Report). The procedure applies to returns in the exam group, PSP suspense or Technical Services suspense. This will allow for the distinction between the inventory (before and after the project completion date/termination report- whichever is earlier).

Operating Unit Specifics

CIP coordinators are expected to regularly monitor projects to determine if they are still viable and proceeding according to the project authorization.

During Headquarters reviews, CIP Coordinators will be asked for documentation of monitoring activities. See IRM 4.17.2.2CIP Coordinator regarding the use of the CIP Data Overview Report (DOR).

TE/GE monitoring and status reports guidelines are in the respective IRMs. See IRM 4.17.1.1, Overview

If the CIP issue and market segment are national in scope, a national CIP should be considered. It can originate in the Area or in the Headquarters, Campus, Specialty functional units, or TE/GE divisions.

A national CIP follows the same approval requirements outlined in IRM 4.17.4.3.5, Review, Concurrence and Approval of Part One CIP Only or IRM 4.17.4.4.4, Review, Concurrence and Approval Part Two Authorization Requests.

Headquarters will retain the original authorization request after approval. Copies will be made available to the appropriate Program Managers.

The SB/SE HQ CIP Program Analyst will coordinate with other divisions where the CIP crosses business operating units.

The Operating Division CIP Analyst or Coordinator (SB/SE, LB&I or TE/GE) will coordinate with their counterpart when it is determined that the CIP affects another division.

Approval channels for cross-operating division CIPs require the approval of the applicable division Commissioner or his/her delegate as outlined in IRM 4.17.4.3.5, Review, Concurrence and Approval of Part One CIP Only or IRM 4.17.4.4.4, Review, Concurrence and Approval Part Two Authorization Requests.

Form 13502Compliance Initiative Project Authorization - Part One, This form is used to request a Part One CIP Authorization.

Form 13498Compliance Initiative Project Authorization - Part Two, this form is used to request a Part Two CIP Authorization.

Form 13497Compliance Initiative Project Authorization - Termination Report, - This form is used to prepare the termination report.

LB&I Workload Selection Form - this form is required for all new LB&I CIP’s.