I.R.S. Market Segment Specialization Program
The Market Segment Specialization Program focuses on developing highly trained examiners for a particular market segment. A market segment may be an industry such as construction or entertainment, a profession like attorneys or real estate agents or an issue like passive activity losses. An integral part of the approach used is the development and publication of Audit Techniques Guides. These Guides contain examination techniques, common and unique industry issues, business practices, industry terminology and other information to assist examiners in performing examinations.
Audit Techniques Guide I.R.S. Web site contains the latest additions
Accuracy - Related Penalties For
Taxpayers Involved In Tax Shelter
Transactions (PDF - 765K)(HTML
View Online)
Publication Date:
08/04
This audit technique guide (“ATG”) was
developed to support the field in the
consistent development and application
of penalties when a taxpayer was
involved in an abusive tax shelter,
including “technical” tax shelters.
Aerospace Industry
(
HTML View Online)
Publication Date:
01/05
The Service has prepared a
comprehensive audit technique guide to
assist examiners in evaluating
research credit in the aerospace
industry. The guide focuses on the
particular unique aspects of the
industry and provides examiners tools
and tests to utilize in evaluating and
auditing research credit.
Auto Body and Repair Industry
(PDF - 247K)
Publication Date:
8/95
Overview of the industry. Discusses
some issues that may be encountered -
including other sources of income;
cost of sales; employment taxes; etc.
Aviation Tax (PDF - 301K)
(HTML
View Online)
Publication Date:
2/99
Pertains to excise taxes imposed on
commercial and non-commercial
aviation. Discusses which set of taxes
applies to which type of flights.
Coal Excise Tax (PDF -
258K)
(HTML View Online)
Publication Date:
05/05
Provides excise tax agents with
specific tools to examine issues
relating to domestically produced
coal.
Commercial Banking (PDF -
701K)
Publication Date:
5/01
Overview of the industry. Discusses
potential issues and terminology
unique to banking.
Construction Industry (PDF
- 1812K)
Publication Date:
10/04
Overview of the industry including a
glossary. Discusses types of
contracts; types of contractors
(large, small, home builder); change
of accounting method; and joint
ventures.
Credit for Increasing Research
Activities (i.e. Research Tax Credit)
IRC § 41 (PDF -116KB)
(HTML View Online)
Publication Date:
06/05
This Audit Techniques Guide sets forth
the Research Credit Technical
Advisors’ suggested guidelines for
auditing research credit issues.
Cost Segregation Audit
Techniques Guide
(HTML
View Online )
Publication Date:
01/14/05
The Service has prepared a
comprehensive audit techniques guide
to assist examiners in evaluating cost
segregation studies submitted by
taxpayers in support of depreciation
deductions. The guide is also
beneficial for taxpayers and
practitioners in preparing these
studies.
Drywallers (PDF - 101K)
Publication Date: 8/98
Overview of the industry. Addresses
specific aspects of a drywall
contractor's business -
business/economic environment;
relationship with general contractor;
cash vs. accrual method of accounting.
Executive Compensation -
Fringe Benefits Audit Techniques Guide
(HTML
View Online)
Publication Date:
02/04/05
Corporate executives often
receive extraordinary fringe benefits
that are not provided to other
corporate employees. Any property or
service that an executive receives in
lieu of or in addition to regular
taxable wages is a fringe benefit that
may be subject to taxation.
Factoring of Receivables Audit
Techniques Guide (PDF - 32KB)
(HTML View Online)
Publication Date:
06/06
This audit techniques guide focuses on
a strategy in which multinational
corporations use factoring of accounts
receivable among related parties to
avoid U.S. taxation by shifting income
offshore and reducing U.S. income by
deducting expenses related to the same
income.
Farm Hobby Losses (ATG)
(PDF - 400K)
Publication Date:
03/01
This audit techniques guide has been
developed to provide guidance to
Revenue Agents and Tax Compliance
Officers in pursuing the application
of IRC Section 183 with respect to
horse activities and cattle
operations.
Farmers Audit Techniques Guide
(ATG) (PDF - 3231KB)
(HTML View Online)
Publication Date:
07/06
The Agriculture Industry Audit
Techniques Guide (ATG) focuses on
developing highly trained examiners
for the Agricultural market segment.
The Guide contain examination
techniques, common and unique industry
issues, business practices, industry
terminology and other information to
assist examiners in performing
examinations.
Farming - Specific Income Issues
and Farm Cooperative (PDF -
98K)
Publication Date:
7/97
Overview of the industry. Discusses
potential for unreported income from
primary farm income and nonfarming
sources.
General Livestock (PDF -
306K)
(HTML
View Online)
Publication Date:
4/00
Provides a focus on the business of
breeding, raising, buying and selling
livestock.
Golden Parachutes Audit
Techniques Guide
(HTML
View Online)
Publication Date:
02/04/05
The Service has prepared a
comprehensive audit techniques guide
to assist examiners in evaluating
parachute examinations. The parachute
examination can occur during the
examination of either the
corporation's or the individual's
return.
Grain Farmers (PDF
file under revision)
Overview of the industry. Provides
terminology. Topics discussed include
underreporting of income, employment
taxes, accounting methods, government
farm programs, etc.
Hardwood Timber Industry
(PDF - 366K)
Publication Date: 2/98
Provides general and technical
information useful to examiners in
classifying, preplanning and examining
returns relating to this industry.
IRC 162(m) Salary Deduction
Limitation Audit Techniques Guide
(HTML
View Online)
Publication Date:
02/04/05
Every publicly held corporation
maintains its executive compensation
records
differently. Likewise, every publicly
held corporation maintains different
methods
for compensating its executives. As
the examining agent, you must first
learn the
identity of the individual(s) within
the corporation who are most familiar
with how
the executive compensation records are
maintained.
The Laundromat Industry
(PDF - 126K)
Publication Date:
6/00
Provides an explanation of water
consumption analysis for
reconstructing unreported income from
the operation of a laundromat. This
method is to be used only when there
is a reasonable indication of
unreported income.
Lawsuit Awards and Settlements
(PDF - 380K)
(HTML
View Online)
Publication Date:
01/01
This guide focuses on taxability of
law suit awards and settlements.
Masonry and Concrete Industry
(PDF - 72K)
Publication Date:
8/98
Provides industry practices;
description of the industry; potential
issues and terminology.
New Vehicle Dealership Audit
Technique Guide (PDF -
1.99 MB)
(HTML
View Online)
Publication Date:
1/05
This guide will give you the key to a
quick and competent closure of any new
vehicle dealership examination which
hinges on narrowing the scope of the
examination to items that may prove
productive.
Non-Qualified Deferred
Compensation Audit Technique Guide
(HTML
View Online)
Publication Date:
02/04/05
The Service has prepared a
comprehensive audit techniques guide
to assist examiners in evaluating
non-qualified deferred compensation. A
nonqualified deferred compensation (NQDC)
plan is any elective or nonelective
plan, agreement, method, or
arrangement between an employer and an
employee (or service recipient and
service provider) to pay the employee
compensation some time in the future.
Oil and Gas Industry
(PDF - 494K)
Publication Date:
5/96
Provides information on basic
operations and common terminology.
Includes reference to royalty owners
and an introduction to financial
products.
Partnerships
(HTML
View Online)
Publication Date:
12/02
The focus is on issues that fall
within sections 701 through 761 of the
Code (Subchapter K). Subchapter K
deals primarily with the formation,
operation, and termination of
partnerships. Many issues arise during
the initial or final year of the
partnership.
Passive Activity Losses (PDF
- 3437 K)
(HTML View Online)
Publication Date:
02/05
Provides examiners with specific
guidance on potential audit issues,
issue identification and lead sheets
and other job aids.
Placer Mining (PDF - 181K)
(HTML
View Online)
Publication Date:
7/99
Provides guidelines for the
examination of taxpayers in this
industry. Focuses on small mining
operations represented as sole
proprietorships on Schedule C, but can
be adapted for partnership and
corporate returns.
Poultry Industry (PDF -
1568K)
Publication Date:
12/02
The purpose of this guide is to
highlight issues that are specific to
or have a large impact on the poultry
industry. Most of the issues in this
guide relate directly to the major
companies rather than the individual
farmers. However, one chapter has been
devoted to the issues normally found
in conjunction with a poultry grower
audit.
The Port Project (PDF -
282K)
Publication Date:
8/95
Provides examiners assistance in
auditing industries related to coastal
and inland waterways.
Reforestation Industry
(PDF - 120K)
(HTML
View Online)
Publication Date:
8/95
Overview of the industry. Discusses
some issues that may be encountered -
including employment taxes; poor
accounting records; etc.
Rehabilitation Tax Credit
(PDF - 353K)
Publication Date:
12/02
Provides examiners with audit aids
(i.e. issue checksheet, pro forma
Information Document Request, and
standardized audit reports, etc.)
which assist in identifying and
addressing common rehab tax credit
issues.
Retail Industry
(PDF)
(HTML
View Online)
Publication Date:
8/05
Overview of the Retail Industry.
Scrap Metal Industry (PDF -
245K)
(HTML
View Online)
Publication Date:
2/99
Provides overview of industry,
glossary and examination techniques
for both purchasers and sellers of
scrap metal.
Shareholder Loan (ATG) (PDF
- 254K)
Publication Date:
06/01
This guide has been developed to
provide guidance in addressing arm's
length concerns, the timing of
interest recognition, and the
allocation of interest and principal.
This guide addresses only issues
regarding loans to shareholders.
Split Dollar Life Insurance
Audit Techniques Guide
(HTML
View Online)
Publication Date:
03/07/05
Split-dollar life insurance
arrangements can be a key feature of
executive compensation packages. Over
the years, the Service has provided
limited guidance regarding the
taxation of these arrangements.
Beginning in 2001, transitional
guidance on the valuation of
split-dollar life insurance
arrangements was provided in the form
of notices and proposed regulations in
anticipation of final regulations.
Sports Franchises (PDF -
411K)
(HTML
View Online)
Publication Date:
8/99
Focuses on major league franchises.
Potential issues may include revenue
(sponsorship, broadcast, season
tickets), strike fund payments,
stadium issues, player contracts,
purchase/sale of franchise, league
expansion, etc.
Stock Based Compensation
Audit Techniques Guide
(HTML
View Online)
Publication Date:
02/04/05
The Service has prepared a
comprehensive audit techniques guide
to assist examiners in evaluating
stock-based compensation. Stock-based
compensation generally consists of
either the transferring of stock or
the issuance of stock options to an
employee or independent contractor.
Swine Farm Industry (PDF -
920KB)
Publication Date:
12/02
Overview of the industry includes
methods of accounting (accrual vs.
cash), farm price inventory, unit
livestock price, prepaid feed, income
from discharge of indebtedness,
selection fees, depreciation, grower
issues, penalties, research credits,
employment taxes, and excise taxes.
Tobacco Industry (PDF -
174K)
Publication Date:
3/96
Focuses on techniques for examining
tobacco farmers, dealers and warehouse
operations.
Veterinary Medicine (PDF -
495K)
(HTML View Online)
Publication Date:
4/05
Overview of industry includes
discussion of types of business
entities (especially personal service
corporation); cash vs. accrual method
of accounting; and inventory vs.
supplies.