1.2.1  Policies of the Internal Revenue Service

1.2.1.1  (09-04-2007)
Introduction to IRM 1.2.1

  1. This Internal Revenue Manual (IRM) section serves to introduce the newly structured manner in which Policy Statements will be maintained. Prior issues of IRM 1.2.1 contained all of the IRS Policy Statements in one large section. They were numbered to coincide with a categorizing system that is no longer used in the IRS. IRM 1.2.1 is now strictly an introduction to the new format for publishing Policy Statements. See below for details.

  2. An initiative is underway to completely overhaul the Commissioner's Policies. Some of them exceed 40 years old and due to changes in IRS climate and technological advancements, no longer serve their original intended purpose. The Office of the Chief Counsel and the Office of Servicewide Policy, Directives, and Electronic Research (SPDER) are working with the division and functional owners of the policy statements to determine which ones are still current, which ones should be cancelled, and which ones need revision.

  3. This IRM contains a listing of all statements of Service policy. Some are new, some have been revised and some remain unchanged. As Policy Statements are revised they will be renumbered to accommodate the restructured IRS and conform to the IRM numbering process to which they apply. This will make finding related Policy Statements easier.

  4. Each policy statement is printed only once under the Internal Revenue Manual Part number to which it has principal application. However, the policy statements apply to all Service personnel involved in the type of program, activity, function, or work process covered by the policy statements.

  5. References to policy statements will continue to be incorporated into IRMs, Handbooks, and Law Enforcement Manuals as appropriate.

  6. Exhibit 1.2.1-1 shows a listing of all of the Policy Statements by the process to which they belong. Each group of policy statements is preceded by a header which includes the title of the process and the IRM number they are published in. They are listed by Number and Title. See Exhibit 1.2.1-1.

Exhibit 1.2.1-1  (09-04-2007)
Policy Statements by Process

Number Year of Issuance Title
  Organization, Finance and Management - IRM 1.2.10
1–1 1993 Mission of the Service
1–2 1986 Principles of Quality
1–3 (formerly 1-40) 2007 Studies, tests and research projects improve operations and decision-making throughout the Service
1–18 2005 Furnishing Tax Forms and Certain Publications to Tax Practitioners and Others
1–21 1986 The Internal Revenue Service will be a progressive organization
1–27 2000 Protection from Reprisal for Whistleblowing
1–28 2006 Occupational Safety and Health Programs to be provided for employees
1–44 1996 Monitoring of Employee Telephone Conversations
1–45 1986 The Service Recognizes the Importance of the Work Environment
1–46 1987 Child Care
1–47 1992 Reasonable Accommodations for People with Disabilities
1–48 1991 Reimbursement of Travel Expenses is Authorized for a Guest Attending an Awards Ceremony
1–63 1960 Operations to be under Financial Plan
1–64 1960 Financial management system to include management at all levels
1–65 1960 Budget estimates as commitments
1–66 1960 Execution of budget to conform to budget commitments
1–97 1994 Authority for use of payments for special statistical studies
1–109 1988 Individually owned property may be used only when authorized
1–110 1959 Employee afforded hearing in property damage cases
1–113 1967 Postage-paid envelopes furnished with third party inquiries
1–124 1959 Tax returns prescribed by National Office; other public use forms require approval
1–125 1998 Permanent records of significant changes to organizations, policies, or programs are to be created, preserved, and transferred to the National Archives and Records Administration (NARA)
1–156 1994 Taxpayer Publications Program enhances voluntary compliance
1–157 1971 Review of publications prepared by other agencies
1–193 1977 Furnishing non-tax related information to GSA concerning prospective lessors
1–212 1972 Useful information necessary for effective management
1–213 1972 Information resources to be carefully managed
1–214 1972 Management and reports officials to select data of maximum Servicewide usefulness
1–226 1982 All Service executives and managers are responsible for effective and efficient use of data processing applications
6–11 1977 Administrative procedures and forms will be designed to promote voluntary compliance
11–12 1967 Assistance in development of tax returns solicited
11–86 1971 Names of disbarred taxpayer representatives published
14–2 1987 Application of Policy Statements to Assistant Commissioner (International) Organization
0–67 1991 Joint Investments By Managers With Subordinates or Superiors
1–178 1989 All segments of Service share responsibility for public attitudes
  Information Technology Activities - IRM 1.2.11
2–5 2005 For Access to Electronic and Information Technology
1–144 1982 Designing safeguards for computer systems
1–227 1982 Management information needs are to be considered in designing or revising automated systems
1–228 1994 Deviation from compatibility standards for Federal Information Processing (FIP) equipment and software requires Chief Information Officer (CIO) approval
1–229 1999 Management and Control of Automated Data Processing (ADP) Property
  Submission Processing - IRM 1.2.12
2–1 1960 Tolerances to relieve districts and service centers of less productive work
2–7 1970 Reasonable cause for late filing of return or failure to deposit or pay tax when due
2–9 1967 Timely mailed returns bearing foreign postmarks to be accepted
2–10 1993 Abatement of Interest on Erroneous Refunds
2–11 1970 Certain unsigned returns will be accepted for processing
2–50 1960 Taxpayer's determination generally accepted as to location of principal place of business for purpose of filing employment and miscellaneous excise tax returns
2–51 1969 Excess payments determined during processing of quarterly employment or excise tax returns generally applied to a taxpayer's account
2–63 1993 Extensions of time for filing certain information returns, approved in bona fide cases
2–64 1993 Extensions of time for furnishing statements to recipients approved in bona fide cases
2–65 1993 Extensions of time for filing Forms W-2 approved in bona fide cases
2–66 1965 Extensions of time for furnishing Form W–2 to employees approved in bona fide cases
2–67 1987 Late filed applications for extensions of time to file returns will not be approved
2–77 1960 Mailing of blank tax return forms to taxpayers
2–88 1971 Elections to apply income tax overpayments to estimated tax may be reversed upon showing of undue financial hardship
2–89 1999 Reconsideration of an Unpaid Assessment
  The Examining Process - IRM 1.2.13
4–3 1984 Cases closed by District Directors or Service Center Directors will not be reopened except under certain circumstances
4–4 1979 Income tax examination will include consideration of taxpayer's liability for employment tax
4–5 2006 Restrictions on Examiners’ and Specialists’ Consecutive Survey or Examination Responsibilities
4–6 1959 Examiner may not examine return if relationship impairs impartiality
4–7 1960 Impartial determination of tax liability
4–8 1966 Removal of books, records and documents to a Service office
4–9 1994 Highest integrity expected
4–10 1960 Service ordinarily will not intervene in litigation in State courts between private litigants; exceptions provided
4–11 1976 Initiation of examinations may be postponed in certain cases
4–21 1974 Selection of returns for examination
4–26 2005 Criminal and civil aspects in enforcement
4–27 2004 Rewards determined by value of information furnished and Computation and payment of rewards
4–34 1961 Closing of overassessment case to be withheld until deficiency of related taxpayer is established
4–35 1961 Appeals conclusion controlling in adjustment of related cases
4–36 1961 Identity of other government agency informants must be protected
4–40 1979 Early agreement primary objective
4–41 1961 Partial overassessments may be allowed in certain contested cases
4–52 1959 Establishment of 18-month examination cycle
4–63 1961 No unwarranted adjustments in statutory notices
4–65 1972 Voluntary payment of barred deficiency or account shall not be solicited
4–75 1967 Usual principles applicable in the examination of claims on their merits
4–76 1967 Disallowed claims may be reconsidered on the merits
4–77 1981 Claims may be allowed without examination
4–80 1961 Depreciation agreements will not extend to property subsequently acquired
4–82 1967 Taxpayer may request referral of issue under jurisdiction of District Director to National Office
4–83 1967 Appeals privileges granted where estimated tax penalty is not agreed
4–88 1999 Jeopardy assessments to be used sparingly and assessment to be reasonable in amount
4–89 1999 Termination assessment of income tax to be used sparingly and assessment to be reasonable in amount
4–101 1961 Employment tax coverage achieved through package examination
4–102 1959 Retroactive assertion of uncollected facilities and service taxes for many prior years generally impractical
4–103 1967 Abatement claims considered only in exceptional circumstances
4–104 1961 Payment from own funds by collecting agency in lieu of uncollected taxes may be accepted
4-116 1983 Special Enrollment Examination
4–117 1996 Examination authority to resolve issues
1–34 1959 Issues to be referred to Office of Secretary
7–20 1988 Selection and Examination of Returns
  The Collecting Process - IRM 1.2.14
5–1 1994 Enforcement is a necessary component of a voluntary assessment system
5–2 2000 Collecting Principles
5–14 2003 Trust Fund Recovery Penalty Assessments
5–16 1984 Forbearance when reasonable doubt exists that assessment is correct
5–28 1959 Successive seizures-Timing to avoid undue hardship
5–29 1999 Levy on salary or wages-Generally limited to take home pay
5–33 1997 Certain Governmental training allowances are not levied
5–34 1999 Collection enforced through seizure and sale of the assets occurs only after thorough consideration of all factors and of alternative collection methods
5–35 1978 Establishment of minimum price in distraint sales
5–38 1978 Seizure of Assets Located on Private Premises
5–39 1989 Reimbursement of Bank Charges Due to Erroneous Levy and Service Loss or Misplacement of Taxpayer Checks
5–40 1987 Welfare of livestock and domestic animals to be considered before or during course of seizure
5–47 1996 Notices of lien generally filed only after taxpayer is contacted in person, by telephone or by notice
5–71 1980 Reporting accounts receivable as currently not collectible-General
5–89 1960 Offer may be rejected for public policy reasons
5–97 1959 Stay of collection-offer in compromise cases
5–100 1992 Offers will be accepted
5–133 2006 Delinquent returns-enforcement of filing requirements
1–167 1959 Operations to be geared to produce the greatest revenue yield with current tax collections given priority
  Human Resources Management - IRM 1.2.15
6–2 2002 Merit Staffing
0–1 1984 District and Service Center Directors will be selected from personnel outside the District and Service Center where the vacancy occurs; exceptions may be made for Assistant District and Service Center Directors who have served for less than three years in their present assignments
0–2 1965 Assistant District Directors and Assistant Service Center Directors will be selected from ES&D graduates who have not recently served for more than a year in the office where the vacancy occurs
0–3 1980 Role of the Office of Personnel Management in recruitment
0–5 2002 IRS Non-Discrimination
0–7 1961 Appointment of consultants and experts to be held to a minimum
0–18 1961 Dual Careers Supported
0–30 1960 Leave regulations will be administered with due consideration for employees and needs of Service
0–35 1960 Requests for excusing or postponing jury duty to be kept to a minimum
0–36 1985 Brief absences may be excused without charge to leave or loss of pay under certain conditions
0–37 1960 Absence because of certain emergency situations will be excused
0–38 1960 Time spent in employee group activities not charged to leave when participation is official duty
0–40 1962 Performance evaluation plan devised so that the service and employees can, with a minimum of paperwork, receive these benefits
0–44 1960 Full participation of employees encouraged
0–100 1960 Training to be provided employees for effective performance
0–101 1960 Determination of training needs and evaluation of programs to be on continuing basis
0–103 1960 Orientation to Service and to job changes provided
0–109 1960 Employees connected with training programs to receive special training
0–111 1962 Basic training in new skills
0–112 1990 Impact of Automation on Employees
  Rules and Agreements Process - IRM 1.2.16
11–23 1967 Rulings and determination letters in general
11–26 1960 Rulings in absence of regulations issued under certain circumstances
11–30 1967 Determination and opinion letters in pension plans of self-employed individuals
11–32 1968 Rulings or determination letters on schemes or devices
11–37 1960 Withdrawal of request for ruling or determination letter
11–38 1967 Unpublished rulings not used as precedents
11–39 1967 Effective date of revocation of a ruling to a taxpayer
11–40 1979 Effective date of determination letter affecting deductible contributions
11–41 1960 Effective date of revocation of determination letter to a taxpayer
11–68 1977 Publication Standards
11–69 1967 Form and scope of published rulings
11–70 1968 Reliance by taxpayers on Revenue Rulings; exceptions provided
11–72 1973 Taxpayer views on rulings or procedures proposed for publication generally not solicited in advance
11–73 1968 Effective date of published rulings
11–74 1968 Effective date of Revenue Ruling revoking or modifying previously published ruling
11–75 1987 Proposed Revenue Rulings or Revenue Procedures are of a confidential nature
11–85 1973 Publication of Internal Revenue Bulletin necessary to tax administration
  Appeals Process - IRM 1.2.17
8–1   Appeals Administrative Dispute Resolution Process
8–2 2007 New issues not to be raised unless material
8–3 2007 Mutual concession cases closed by Appeals will not be reopened by Service except under certain circumstances
8–24 1960 Conferences not granted in 90-day cases in absence of unusual circumstances
8–36 1960 Conference rights of taxpayer with reviewing officer
8–47 1987 Consideration to be given to offers of settlement
8–48 1960 "Split-issue" settlements considered under certain circumstances
  Criminal Investigation Activities - IRM 1.2.18
9–6 1991 Legal Rights of Persons Being Investigated
1–111 1994 Luxury class vehicles excluded from motor vehicle fleet except for surveillance or undercover work
  Communications, Liaison and Disclosure Activities - IRM 1.2.19
11–13 2004 Freedom of Information Act Requests
1–24 1976 Comments on legislation
1–25 1976 Legislative documents are of a confidential nature
1–26 1976 Legislative assistance to other agencies must be authorized
1–35 1979 Agreements to exchange tax information with states entered into when in interests of good tax administration
1–179 1989 Mass information program necessary to Service's objective
1–180 1967 Cooperation with mass media encouraged
1–181 1989 Speaking, writing engagements and contact with outside groups are encouraged subject to limitations
1–183 1986 News coverage to advance deterrent value of enforcement activities encouraged
1–186 1977 Publicity in connection with seizures to enforce collection of tax
1–187 1984 Forwarding letters for private individuals, organizations or corporations and Federal, state and local government agencies without disclosure of address
1–194 1977 Service officials may participate in practitioner liaison meetings; meetings open to public, normally on Government premises; other groups may be invited
6–14 1993 FedState Relations
  Penalties and Interest Activities - IRM 1.2.20
20–1 2004 Penalties are used to enhance voluntary compliance
2–4 1981 Penalties and interest not asserted against Federal agencies
  Customer Account Services - IRM 1.2.21
6–1 1977 Service commitment to Taxpayer Service Program
6–10 1979 The public impact of clarity, consistency, and impartiality in dealing with tax problems must be given high priority
6–12 1991 Timeliness and Quality of Taxpayer Correspondence
6–13 1993 One-stop service defined
6–40 1977 Assistance furnished to taxpayers in the correction of accounts
  Taxpayer Education and Assistance Activities - IRM 1.2.22
6–21 1977 Educational programs provided
6–20 1977 Information provided taxpayers on the application of the tax law
6–41 2001 Commitment to assist non-English speaking taxpayers understand their tax obligations
  Chief Counsel Activities - IRM 1.2.23
1–28 1959 Petitions for changes in regulations to be considered
1–29 1987 Proposed regulations are of a confidential nature
1–30 1974 Comments concerning proposed regulations
1–31 1987 Requests for public hearings usually granted; exceptions provided
  Special Topic Activities IRM 1.2.24
25–1 2005 Assisting taxpayers who report they are victims of identify theft

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