[Code of Federal Regulations]
[Title 26, Volume 11]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.1313(a)-4]

[Page 638-640]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1_INCOME TAXES--Table of Contents
 
Sec. 1.1313(a)-4  Agreement pursuant to section 1313(a)(4) as a determination.

    (a) In general. (1) A determination may take the form of an 
agreement made pursuant to this section. This section is intended to 
provide an expeditious method for obtaining an adjustment under section 
1311 and for offsetting deficiencies and refunds whenever possible. The 
provisions of part II (section 1311 and following), subchapter Q, 
chapter 1 of the Code, must be strictly complied with in any such 
agreement.

[[Page 639]]

    (2) An agreement made pursuant to this section will not, in itself, 
establish the tax liability for the open taxable year to which it 
relates, but it will state the amount of the tax, as then determined, 
for such open year. The tax may be the amount of tax shown on the return 
as filed by the taxpayer, but if any changes in the amount have been 
made, or if any are being made by documents executed concurrently with 
the execution of said agreement, such changes must be taken into 
account. For example, an agreement pursuant to this section may be 
executed concurrently with the execution of a waiver of restrictions on 
assessment and collection of a deficiency or acceptance of an 
overassessment with respect to the open taxable year, or concurrently 
with the execution and filing of a stipulation in a proceeding before 
the Tax Court of the United States, where an item which is to be the 
subject of an adjustment under section 1311 is disposed of by the 
stipulation and is not left for determination by the court.
    (b) Contents of agreement. An agreement made pursuant to this 
section shall be so designated in the heading of the agreement, and it 
shall contain the following:
    (1) A statement of the amount of the tax determined for the open 
taxable year to which the agreement relates, and if said liability is 
established or altered by a document executed concurrently with the 
execution of the agreement, a reference to said document.
    (2) A concise statement of the material facts with respect to the 
item that was the subject of the error in the closed taxable year or 
years, and a statement of the manner in which such item was treated in 
computing the tax liability set forth pursuant to subparagraph (1) of 
this paragraph.
    (3) A statement as to the amount of the adjustment ascertained 
pursuant to Sec. 1.1314(a)-1 for the taxable year with respect to which 
the error was made and, where applicable, a statement as to the amount 
of the adjustment or adjustments ascertained pursuant to Sec. 
1.1314(a)-2 with respect to any other taxable year or years; and
    (4) A waiver of restrictions on assessment and collection of any 
deficiencies set forth pursuant to subparagraph 3 of this paragraph.
    (c) Execution and effect of agreement. An agreement made pursuant to 
this section shall be signed by the taxpayer with respect to whom the 
determination is made, or on the taxpayer's behalf by an agent or 
attorney acting pursuant to a power of attorney on file with the 
Internal Revenue Service. If an adjustment is to be made in a case of a 
related taxpayer, the agreement shall be signed also by the related 
taxpayer, or on the related taxpayer's behalf by an agent or attorney 
acting pursuant to a power of attorney on file with the Internal Revenue 
Service. It may be signed on behalf of the Commissioner by the district 
director, or such other person as is authorized by the Commissioner. 
When duly executed, such agreement will constitute the authority for an 
allowance of any refund or credit agreed to therein, and for the 
immediate assessment of any deficiency agreed to therein for the taxable 
year with respect to which the error was made, or any closed taxable 
year or years affected, or treated as affected, by a net operating loss 
deduction or capital loss carryover determined with reference to the 
taxable year with respect to which the error was made.
    (d) Finality of determination. A determination made by an agreement 
pursuant to this section becomes final when the tax liability for the 
open taxable year to which the determination relates becomes final. 
During the period, if any, that a deficiency may be assessed or a refund 
or credit allowed with respect to such year, either the taxpayer or the 
Commissioner may properly pursue any of the procedures provided by law 
to secure a further modification of the tax liability for such year. For 
example, if the taxpayer subsequently files a claim for refund, or if 
the Commissioner subsequently issues a notice of deficiency with respect 
to such year, either may adopt a position with respect to the item that 
was the subject of the adjustment that is at variance with the manner in 
which said item was treated in the agreement. Any assessment, refund, or 
credit that is subsequently made with respect to the tax liability for 
such

[[Page 640]]

open taxable year, to the extent that it is based upon a revision in the 
treatment of the item that was the subject of the adjustment, shall 
constitute an alteration or revocation of the determination for the 
purpose of a redetermination of the adjustment pursuant to paragraph (d) 
of Sec. 1.1314(b)-1.

[T.D. 6500, 25 FR 12037, Nov. 26, 1960]