The IRS is an agency of the Treasury Department and is charged with the administration of the tax laws. It is the largest government agency in the world. Headed by the Commissioner of Internal Revenue, its structure is as follows:
(1) There are four civil compliance divisions responsible for serving specific groups of taxpayers with similar needs. They are:
a. Wage and Investment Division: This division services 88 million individual taxpayers who have only wage and investment income, almost all of which is reported to the IRS by third-party payors.
b. Small Business Self-employed Division: This division is responsible for taxpayers who are fully or partially self-employed and small businesses with assets of $ 10 million or less, such as C corporations, S corporations, and partnerships. It is organized into various segments tailored to the needs and filing patterns of small businesses.
c. Large and Mid-size Business Division: This division includes the largest filers with assets over $ 10 million. It is divided into industry segments: Retailers, Food, Pharmaceutical, and Healthcare; Natural Resources and Construction; Financial Services; Heavy Manufacturing and Transportation, and Communications, Technology, and Media.
d. Tax Exempt and Governmental Entities Division: There are three segments: (1) employee pension plans; (2) exempt organizations; and (3) governmental entities. These entities collectively pay more than $ 220 billion in employment tax and income tax withholding to the U.S. government.
(2) The IRS is made up of several offices. They are:
a. Criminal Investigation: Works on potential criminal violations of the tax laws and related financial crimes.
b. Appeals: An independent administrative forum for dispute resolution with the authority to settle deficiency, refund, and collection cases.
c. Chief Counsel: Otherwise known as the IRS’s “top lawyer,” Chief Counsel’s Office plays a pivotal role in the administration of the federal tax laws. Its attorneys provide the IRS guidance on interpreting tax laws, represents the IRS in litigation, and provides all other legal support the IRS needs to carry out its mission. This includes (1) drafting regulations; (2) representing the IRS in Tax Court; (3) working with the Department of Justice on tax litigation in federal court; and (4) providing specific legal advice and determinations to various IRS offices and to taxpayers. Attorneys within Chief Counsel’s Office are organized along functional lines within the IRS’s current organization. In other words, the four civil compliance divisions have Chief Counsel attorneys assigned to them to provide legal guidance.
d. Taxpayer Advocate: The Taxpayer Advocate represents a taxpayer’s interests when the system fails or the taxpayer is being treated unfairly and the normal procedures are inadequate. Its principal function is two-fold: (1) To assist taxpayers in resolving problems with the IRS and (2) To identify taxpayer problem areas when dealing with the IRS and to propose solutions to these problems, both administratively and legislatively. Organizationally, the Taxpayer Advocate consists of the National Taxpayer Advocate in Washington, various area advocate offices spread throughout the country and aligned with specific operating divisions, and a series of local Taxpayer Advocate offices.
e. Communication and Liaison Office: This office is responsible for disseminating information to Congress and the general public about IRS programs and policies.
f. Research, Analysis, and Statistics Office: This office gathers and disseminates statistical data on tax compliance that the IRS uses to create enforcement programs.
Original Post By: Michael DeBlis
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