The IRS today announced changes to the “Compliance Assurance Process” (CAP) program for 2019. The IRS will shift the start of the application period to October 1, 2018, and it will close on November 30, 2018.
As noted in the IRS release (IR-2018-174), the proposed changes are designed to improve operation of the program, make the best use of limited government resources, and to ensure the sustainability of the program. Changes will be effective for the upcoming 2019 application period, with additional changes expected the following year and into the future.
The CAP program allows large corporate taxpayers to work collaboratively with an IRS team to identify and resolve potential tax issues before tax returns are filed. The CAP program began as a pilot program in 2005 with 17 taxpayers. It was made permanent in 2011, and now includes 169 taxpayers. The CAP program consists of three phases: CAP, pre-CAP (provides interested taxpayers with a roadmap of the steps required for gaining entry into CAP), and the Compliance Maintenance program (for taxpayers who have been in CAP, have fewer complex issues, and have established a track record of working cooperatively and transparently with the IRS).
The changes and reinforcement of existing policies are intended to ensure that engagement by taxpayers and the IRS are consistent with the original objectives of the program.
Additional changes are anticipated for the following CAP cycle and into the future.
© 2018 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
KPMG International Cooperative (“KPMG International”) is a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.