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Tax Blawg

Tax Talk for Tax Pros

Introduction

Welcome to TaxBlawg, a resource for news and analysis of current legal issues facing tax practitioners. Although blawg.com identifies nearly 1,400 active “blawgs,” including 20+ blawgs related to taxation and estate planning, the needs of tax professionals have received surprisingly little attention. The Wall Street Journal's Tax Blog gives “tips and advice for filers,” and Paul Caron’s legendary TaxProf Blog is an excellent clearinghouse for academic and policy-oriented news. Yet, tax practitioners still lack a dedicated resource to call their own. For those intrepid souls, we offer TaxBlawg, a forum of tax talk for tax pros.

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How Does IRS Police Its Own Lawyers?

The IRS employs many lawyers and employees of the IRS Office of Chief Counsel are its principal legal staff who number 1560, of whom about 550 work in the IRS National Office in Washington, while the balance work in offices around the country.  They provide legal advice to the Commissioner of Internal Revenue and the local IRS offices, and they act as the lawyer for the Commissioner of Internal Revenue in all Tax Court cases.  In addition, some are specially designated to assist United States Attorneys in bankruptcy, summons enforcement and other civil cases.

In 1998, a Chief Counsel’s Professionalism Program was established, to ensure that the office fully complies with Treasury directives, and that all allegations of misconduct are promptly and thoroughly investigated.  All allegations or evidence of an employee’s serious or significant failure to comply with accepted standards must be referred to the Deputy Chief Counsel (Operations), and the most serious matters must be referred to the Office of the Treasury Inspector General for Tax Administration (TIGTA).

The IRS Office of Chief Counsel recently released reports on the subject of professionalism for the years 2009 through 2012, and the findings – which are broken between TIGTA and non-TIGTA cases – are worth noting.

The kinds of TIGTA cases include situations such as an employee lost a government laptop, misused the IDRS system to seek address information about an ex-spouse of the employee’s child, used Office of Chief Counsel letterhead to write a letter to a court on behalf of a personal friend who was being sentenced on tax-related charges, and one who used the Government computer to send emails on a private, non-work related matter which created the impression that they were acting in an official role.  The results of the investigations were as follows:

2008

2009

2010

2011

2012

Cases not substantiated

15

11

18

16

15

Employees separated before reviewcompleted

2 retired

5 resigned

0 retired

0 resigned

0 retired

0 resigned

  7

  0

Substantiated

15

28

15

27

25

Undetermined

  1

  1

  0

  0

  0

               TOTAL

38

40

33

50

40

Of those cases, the nature of the disciplinary action was reported for 2009-2011 as follows:

2009

2010

2011

2012

Counseling

Written-3

Oral-2

Written-1

Oral-8

Written-4

Oral-16

Written-1

Oral-20

Admonishment

  0

  2

  3

  1

Reprimand

  1

  1

  1

  1

Suspension

  1

  2

  3

  0

Removal

  0

  0

  0

  2

Downgrade

  0

  0

  0

  0

               TOTAL

14

27

  7

25

The reports also described the actions in non-TIGTA cases which fell in similar classifications.  The kinds of non-TIGTA cases which arose involved failing to file a proper tax return – overlooking interest income; failure to comply with deadlines imposed by the Tax Court; taking leave without authority; and a verbal altercation in an open office area involving racial terms and profanity.  In 2010, disciplinary action was taken in 97% of such cases, 100% in 2011, and 100% in 2012.

Given all the attention received for the Section 501(c)(4) situation, it is comforting to see that professionalism is not being ignored within the Office of Chief Counsel.  It will be interesting to see how all of the current allegations are dealt with in this framework.

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    George Connelly is recognized as one of the leading federal tax litigators in the United States.  His practice focuses on IRS audit, collection and criminal matters including civil and criminal tax litigation matters, for clients ...