6.3.4 Record retention and production
Commentators expressed concern that language requiring schedules, exhibits, exhibits, computer programs, and other information used to produce values was too broad, making it difficult to know what materials must be retained and produced. The Treasury retained these requirements, asserting that other sections of the Code already require taxpayers to maintain sufficient records to support the accuracy of items reported on their federal tax returns. Except for a possible increase in the retention period in some instances, the Final Regulations impose no additional burden.
The IRS has indicated that it had conducted a test programme where it was demonstrated that 30 days was generally a sufficient period of time to produce the records. The Commissioner may also excuse failures to provide information within the 30-day period where there has been a good faith effort to comply. Additionally, a taxpayer may also enter into an agreement with the Commissioner regarding the types of records that are required and the length of time they are to be retained.