AS TO THE meaning of a legitimate expectation, take a look at the “Tax Risk Management Dictionary” at the beginning of this special report. Its practical significance comes from the advice a taxpayer will get from a legal team that is alive to new possibilities and defenses. When preparing for any defense on a tax inquiry from the IRS, the key starting point is the facts — all the facts. Then marry the facts to the legislative provisions and any enlightening case law. Now there is an additional opportunity. How has the IRS publicly interpreted the tax provisions? Have they published any practice notes for clarification? If so, these public statements can be relied upon by the taxpayer in any defense, being a legitimate expectation in favor of the taxpayer, that cannot just be ignored by the Internal Revenue Service, from a procedural point of view. They are bound to their statements and can only change them into the future.