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Deputy Commissioner (LB&I) Flax Discuss Revised Procedures and Priorities During COVID-19 Pandemic

Client Alert | 2 min read | 11.04.20

On October 5, Nikole Flax, Deputy Commissioner, LB&I, provided an update on LB&I’s revised procedures and priorities during the COVID-19 pandemic, including the CARES Act, electronic submissions and virtual interactions, the Large Corporate Compliance Program, LB&I Campaigns, and the CAP program. A video of Ms. Flax’s presentation at the 34th Annual Crowell & Moring Managing Audits and Appeals Seminar may be found here.

Ms. Flax discussed LB&I’s recent announcement that it is considering rescinding Revenue Procedure 94-69. Rev. Proc. 94-69 provides special procedures for taxpayers that are subject to the former Coordinated Examination Program to show additional tax due or make disclosures to avoid the imposition of accuracy-related penalties for negligence, disregard of rules or regulations, or substantial understatement of income tax under IRC section 6662(b)(1) and (b)(2). Ms. Flax explained that Rev. Proc. 94-69 was written for an old program that no longer exists, so “[a]t a minimum, it needs to be cleaned up, because the words don’t match right now.” Ms. Flax stated that there is not a set timeframe for a decision and that the IRS would need time to consider the comments submitted by interested parties. Critics have noted that Rev. Proc. 94-69 creates disparity among LB&I taxpayers and fails to support the broader tax administration effort to improve the accuracy and reliability of returns at the time of filing.

Ms. Flax also discussed the rollout of a Large Partnership Compliance Program slated for 2021. She explained that it would be similar to the Large Corporate Compliance Program, including selecting entities for audit using data analytics. This announcement comes on the heels the IRS’s recent efforts to gear up for new BBA efforts, including the launch of a new BBA centralized partnership audit webpage, available here. The webpage provides resources for taxpayers where they can find regulations and other guidance and instructions related to the Partnership Representative (PR), electing out of the centralized audit regime, Administrative Adjustment Requests (AARs) and what to expect during a BBA administrative proceeding.

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Client Alert | 4 min read | 05.13.24

Harmonizing AI with EEO Requirements: OFCCP’s Blueprint for Federal Contractors

Now more than ever, federal contractors find themselves at the intersection of innovation and regulation, particularly in the realm of Artificial Intelligence (AI).  AI is now incorporated into a broad range of business systems, including those with the potential to inform contractor employment decisions.  For that reason, the Office of Federal Contract Compliance Programs (OFCCP) has issued new guidance entitled “Artificial Intelligence and Equal Employment Opportunity for Federal Contractors” (the “AI Guide”).  OFCCP issued the AI Guide in accordance with President Biden’s Executive Order 14110 (regarding the “Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence”), which we reported on here.  The AI Guide provides answers to commonly asked questions about the use of AI in the Equal Employment Opportunity (EEO) context.  The AI Guide also offers “Promising Practices,” which highlight a number of important considerations for federal contractors.  Focusing on federal contractors’ obligations and attendant risks when utilizing AI to assist in employment-related decisions, the AI Guide also provides recommendations for ensuring compliance with EEO requirements while harnessing the efficiencies of AI....