The new memorandum (SBSE-04-1811-070) is the latest development in a continued crackdown on the use of these subsidiaries to avoid taxes.

In the Aug. 9 document, released on the web Sept. 19, IRS told agents to check whether captive subsidiaries have engaged in closing agreements with the service and whether there is additional information relating to controlled industry cases.

The guidance outlined a detailed list of other issues agents must look for. It follows a series of other documents unveiled by IRS over the past year indicating the agency is not only looking closely at such subsidiaries, but may be auditing them individually.

Text of SBSE-04-1811-070 is available at http://op.bna.com/dt.nsf/r?Open=vmar-8lvtms.