What benefits does the CAP Program provide to the taxpayer and the IRS

The Compliance Assurance Process (CAP) Program provides several benefits to both the taxpayer and the IRS:

1. Resolves Issues Prior to Filing: The CAP Program allows for the resolution of tax issues before the tax return is filed, providing tax certainty sooner for both parties.
2. Real-Time Review of Transactions: It enables real-time review of transactions, which promotes voluntary compliance and ensures that tax issues are addressed promptly.
3. Resource and Time Savings: The program saves resources and time for both the IRS and taxpayers by reducing the need for post-filing examinations and amendments to state tax returns.
4. Enhances Corporate Governance and Accountability: CAP complements current corporate governance and accountability practices, ensuring that tax compliance is integrated into the overall management of the company.
5. Early Identification of Emerging Issues: The program helps in the earlier identification of new and potentially emerging tax issues, allowing for proactive management and resolution.

These benefits collectively contribute to a more efficient and effective tax compliance process for large corporate taxpayers and the IRS.

Sources:
Rev. Proc. 2021-9
Rev. Proc. 2022-9