IRS Proposes Increased Disclosure Of Uncertain Tax Positions

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On Jan. 26, 2010 the IRS released Announcement 2010-9, described by IRS Commissioner Doug Shulman in remarks at a conference last week as, "a major step towards transparency ... related to changes we are proposing to reporting requirements regarding business taxpayers’ uncertain tax positions."

Included among the proposed new disclosures to the IRS would be the "maximum amount of U.S. income tax exposure if the taxpayer's position is not sustained."

In his remarks at the New York State Bar Association, Shulman explained the impetus for the proposal:

Today, we spend up to 25 percent of our time in a large corporate audit searching for issues rather than having a straightforward discussion with the taxpayer about the issues. It would add efficiency to the process if we had access to more complete information earlier in the process regarding the nature and materiality of a taxpayer’s uncertain tax positions. The goals of our proposal are simple: to cut down the time it takes to find issues and complete an audit… ensure that both the IRS and taxpayer spend time discussing the law as it applies to their facts, rather than looking for information…and to help us prioritize selection of issues and taxpayers for examination.

The comment deadline, as noted in Announcement 2010-09, is March 29, 2010.

Read more about the IRS proposal, and views expressed by FEI's Senior Director of Government Affairs with respect to the proposal, here.

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