The Internal Revenue Service's tax-exempt bond division does not plan to hire more fieldagents in the next
fiscal year but will continue to train its existing staff on specific enforcement issuesas a way to improve its audit investigations.
Each three-day training session will covers a specific topic such as multifamily housingbonds in a classroom
setting where field agents learn from both ongoing and closed audits.
"It's hands-on training," said Mark Scott, director of the IRS' tax-exempt bonddivision. "We have seen progress either in getting the cases resolved or moved to thenext appropriate level."
Between 10 and 20 field agents attend each training session, which have been held acrossthe country. All of the division's 39 field agents have been through at least one of thesessions, Scott said. The training is in addition to the six weeks of training requiredfor new agents.
The idea for the specialty classes first came up in 2001 when the enforcement divisionheld a specialty session on single-family mortgage bonds in Los Angeles. "Single-familymortgage bonds have peculiar rules, so we wanted to do some specific training in thatarea," Scott said.
Scott said he noticed marked improvements by field agents in the single-family mortgageinvestigations after the session. "Once we did that training, we decided it wassomething we should continue," Scott said.
The IRS since then has held about two specialty-training sessions for tax-exempt bondseach fiscal year, Scott said. The federal fiscal year begins Oct. 1. The IRS recentlyheld a session for
multifamily housing and small issue manufacturing bonds in Nashville. It also heldspecialty sessions that covered pooled bonds and Section 6700 if the Internal RevenueCode, which allows the IRS to apply penalties to municipal bond participants responsiblefor tax
law or regulatory abuses. The sessions were held in Washington, D.C., and Chicago.
Sessions covering qualified 501(c)(3) bonds and another still-undetermined topic will beheld in the next 12 months, Scott said.
Mitchell Rapaport, chairman of the National Association of Bond Lawyers tax committeeand a tax partner with Nixon Peabody LLP here, applauded the training sessions.
"It is a sign of the growing expertise that the auditors are getting training inspecific areas and have moved beyond just getting trained on the basics of tax-exemptbonds," Rapaport said. "The continued training to gain greater expertise in complexareas is something that is helpful to the industry."
