expansion tank missing

I looked at a 1997 house today and the original gas water heater had been replaced with a Rinnai tankless. House was on a slab and around here, the expansion tanks are at the water heater. I have a feeling the tank was removed and not replaced. From what I understand, a tank is not needed if one has a regulator with an internal bypass. This looked like a standard regulator but was wrapped in insulation for the most part. Do the bypass regulators have a return line? So there would be three lines connected to it total, right?

You do NOT have to have an expansion tank with a tankless, because they do NOT have expansion problems. Internal bypass regulators only work if the city pressure is within the limits of a safe pressure. They do not have any additional lines, because it is "internal".