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Part 11. Communications and Liaison

Chapter 3. Disclosure of Official Information

Section 33. Other Disclosures to State and Local Governments

11.3.33  Other Disclosures to State and Local Governments

11.3.33.1  (07-01-2006)
Purpose

  1. This section provides guidelines for:

    • furnishing return information to State and local child support enforcement agencies;

      Note:

      In some situations this may also include a Federal child support enforcement agency.

    • disclosing exempt organization information to State officials; and

    • disclosing unearned income information from the IRMF file to Federal, state, and local welfare agencies.

11.3.33.2  (07-01-2006)
Furnishing Return Information to Federal, State, and Local Child Support Enforcement Agencies

  1. IRC 6103(l)(6) authorizes the IRS to disclose to Federal, State or local child support enforcement agencies, upon written request, certain items of information from any return of an individual with respect to whom child support obligations are sought to be established or enforced or from any return of an individual with respect to whom support obligations are owing.

    Note:

    IRC 6103(l)(8) allows the Social Security Administration to disclose certain tax return information (primarily wage and self employment data) to Federal, State, or local child support enforcement agencies under essentially the same conditions of IRC 6103(l)(6).

  2. The IRS may disclose return information to those agencies only for the purpose of their administration of Part D of Title IV of the Social Security Act and only to the extent necessary for their use in establishing and collecting child support obligations from, and locating, individuals owing such obligations.

    Note:

    The receiving agency on its own volition may not use the tax information for other relief programs it administers even if the same/similar information for those programs is available from IRS.

  3. Generally, return information obtained under IRC 6103(l)(6), except as provided by the IRC, may not be disclosed by the State or local child support enforcement agency to third parties (including contractors but see (4) below) or in judicial or administrative proceedings. The prohibition on contractor access is due to the fact that the statute does not allow such disclosures. The prohibition on judicial use is explained in the Joint Committee Report on the 1976 Tax Reform Act. Independently corroborated information may be used by the agency consistent with its own disclosure laws. The tax information received from IRS, however, retains its original character and must be protected and only redisclosed as described in IRC 6103. Address information reentered into agency files from postal tracers is considered to be independently corroborated information. The one exception to use in litigation is disclosure to state prosecutors (and subsequent trial) under P.L. 96-611, the Parental Kidnapping Act. That law, which defines parental kidnapping cases as child support cases, specifically states that addresses obtained from the Parent Locator Service (PLS) (see IRM 11.3.33.2(6)) may be made available to a state for the purpose of determining the whereabouts of any absent parent or child for the purpose of:

    • enforcing any State or Federal law with respect to the unlawful taking or restraint of a child, or

    • making or enforcing a child custody determination.

  4. With the passing of Public Law 104-193, IRC 6103(l)(6)(B) permits agents (contractors) of child support enforcement agencies to receive certain return information. Disclosures are limited to:

    • the address and Social Security Number(s) of the individual with respect to whom child support obligations are sought to be established or enforced; and

    • the amount of the offset against a Federal income tax refund for collection of past due child support obligations.

  5. Return information which may be disclosed to child support enforcement agencies is extracted from the IMF and IRMF.

  6. Taxpayer address and SSN verification information from the IMF will be made available to the State and local child support enforcement agencies by the Parent Locator Service (PLS), HHS/OCSE. See (11) below.

  7. In accordance with IRC 6103(l)(6)(A)(ii), the IRS may disclose to Federal, State, or local child support enforcement agencies with respect to those individuals described in (1) above, available return information reflected on any return filed by or with respect to any such individual which relates to:

    • the amount of such individual's gross income; or

    • the name and addresses of the payers of such income.

    Note:

    The disclosures listed above can only be made if such information is not reasonably available from any other source. Currently, the law does not allow disclosure of the payer's employer identification number.

  8. Only those child support enforcement agencies which have been determined by Headquarters to be eligible to receive this information may request this return information.

  9. Return information obtained by child support enforcement agencies pursuant to the provisions of IRC 6103(l)(6) may be disclosed to other agency personnel on a need-to-know basis for purposes of performing those actions described in that code section.

  10. The child support enforcement agencies may use return information to obtain leads regarding records to which the return information pertains, such as employer payroll records. These records, once obtained, could be disclosed to third parties or used in litigation. The original records obtained from IRS do not lose their confidentiality status even if independently corroborated.

  11. Taxpayer address information from the IMF will ordinarily be disclosed only to the Parent Locator Service (PLS), Office of Child Support Enforcement (OCSE), Department of Health and Human Services (HHS). These disclosures will be made by the Martinsburg Computing Center in accordance with Taxpayer Address Request (TAR) procedures.

  12. The PLS may then provide this information to State and local child support enforcement agencies as authorized by Part D of Title IV of the Social Security Act.

11.3.33.2.1  (07-01-2006)
Contractual Agreements

  1. HHS/OCSE will be the official agency to enter into contractual agreements with the IRS.

  2. HHS/OCSE will be responsible for releasing tax return information from IRS files to the State child support enforcement agencies subject to the provisions of IRC 6103. The information is also subject to the disclosure restrictions of the Privacy Act, 5 USC 552a.

  3. The appropriate field Disclosure Manager will act as a receiving point for any inquiries from the agency.

11.3.33.2.2  (07-01-2006)
Return Information Extracted from the IRMF

  1. HHS/OCSE requests for return information relating to:

    • the amount of the individual's sources and types of income;

    • the names and addresses of the payers of such income; and

    • payee address information.

  2. will be submitted to Martinsburg Computing Center (MCC), as part of the HHS/OCSE extract.

  3. Coordination of IRMF extracts is handled by the Director, Office of Governmental Liaison and Disclosure.

11.3.33.2.3  (07-01-2006)
Return Information Extracted from the IMF

  1. IRC 6103(l)(6)(A)(i) permits the disclosure of certain tax information reflected on a return filed by or with respect to a person against whom child support obligations are sought to be established or enforced.

  2. Tax information of a new spouse reflected on a return filed jointly with a person described above may be disclosed to a Federal, State, or local child support enforcement agency. However, the new spouse's identity information (name and social security number) may not be disclosed.

11.3.33.2.4  (07-01-2006)
Processing Responsibilities

  1. HHS/OCSE has full responsibility for overseeing processing requirements for the State/local Child Support Enforcement Agencies.

  2. Headquarters has responsibility for coordinating with HHS/OCSE to insure that all necessary processing requirements are met.

  3. The disclosures generated from the IMF/IRMF will be accounted for automatically or will be done using the Narrative Accounting procedures in IRM 11.3.37, Recordkeeping and Accounting for Disclosures.

11.3.33.2.5  (12-31-2001)
Billing Procedures

  1. Headquarters, Chief Financial Officer will bill the HHS/OCSE agency for information obtained under this procedure.

  2. The accounting function of Headquarters will handle the billing with HHS/OCSE for information obtained under this procedure.

  3. The Office of Governmental Liaison and Disclosure will coordinate billing.

11.3.33.2.6  (07-01-2006)
Safeguard Requirements

  1. The Office of Safeguards in Mission Assurance and Security Services (MA&SS) has the responsibility to ensure that all safeguard requirements are met in accordance with IRC 6103(p)(4) when Federal, State, and local child support enforcement agencies obtain return information under IRC 6103(l)(6).

  2. Detailed safeguarding instructions are in Publication 1075, Tax Information Security Guidelines for Federal, State and Local Agencies.

11.3.33.3  (07-01-2006)
Furnishing Collection Records to Child Support Enforcement Agencies

  1. IRC 6305 authorizes the IRS to collect delinquent Child Support Obligations (CSOs) for State Child Support Enforcement Agencies.

  2. As part of this activity, the IRS, under IRM 11.3.33.3.1, may disclose information regarding CSOs (but not tax information) from the SBSE Division's Collection function files to these agencies.

11.3.33.3.1  (07-01-2006)
Processing Responsibilities

  1. Revenue Officers are to prepare a status report for the child support enforcement agencies on all CSO TDAs which they have held over ninety days, and a follow-up report will continue every ninety days until the case is closed or transferred to the appropriate field office for monitoring as an NMF installment agreement. This report is to be forwarded to the State Agency by the Disclosure Manager. See IRM 5.1.12, Cases Requiring Special Handling, for Collection related procedures on CSO cases.

  2. The information relative to these TDAs is not return information and therefore not subject to the provisions of 26 USC 6103. However, the information is subject to the disclosure restrictions of the Privacy Act, 5 USC 552a.

  3. The Revenue Officer is to prepare Form 5482, pursuant to the Privacy Act of 1974 and maintain the form as described in IRM 11.3.19.

  4. The appropriate field Disclosure Manager will act as a receiving point for any inquiries from the agency.

11.3.33.4  (07-01-2006)
Disclosure of Information About Exempt Organizations to Appropriate State Officials.

  1. General Statement of Law. Under IRC 6104(c), the IRS automatically notifies appropriate State officials when it has made certain final determinations regarding organizations described in IRC 501(c)(3) that are exempt from taxation under IRC 501(a) or have applied for under IRC 508(a) recognition as an organization described in IRC 501(c)(3). If an appropriate State official makes a request for the administrative material related to the final determination, the IRS will provide the material, subject to the requirements of the Code and regulations.

  2. General Responsibilities of Governmental Liaison and Disclosure (GLD) and Exempt Organizations (EO)

    1. EO will conduct the IRC 6104(c) Notification Program, including maintaining a current notification list, processing routine IRC 6104(c) notifications, advising State officials of their right to access additional information, and maintaining records. See IRM 7.28.2, Disclosure of Information About Exempt Organizations to Appropriate State Officials as Described in IRC 6104(c), for details including request processing procedures.

    2. GLD's Office of Disclosure has the primary responsibility for providing training, advice, and assistance relating to the disclosure of tax returns and return information.

    1. EO should consult with the Disclosure Technical Advisor for TEGE and/or other employees, as GLD may direct, for disclosure problems that are not clear under IRC 6104 or the regulations.

    2. GLD Disclosure Managers will provide assistance to EO, as necessary, including:

      • GLD will provide technical assistance for the screening of the administrative files and determinations regarding requests for those files.

      • GLD will assist EO in training EO employees regarding IRC 6104(c) disclosure requirements, restrictions, and related disclosure matters.

  3. GLD also has liaison responsibilities with outside agencies and organizations. Because of this, EO should contact GLD staff or embedded Liaison staff to coordinate program requirements or events which require additional liaison assistance.

11.3.33.4.1  (07-01-2006)
Definitions

  1. FINAL DETERMINATION:

    1. For purposes of IRC 6104(c), a final determination is when the IRS determines that:

      • An organization is one that is refused recognition as an organization described in IRC 501(c)(3),

      • An organization has been operated in such a manner that it will not meet or no longer meets the requirements of its exemption under IRC 501(c)(3), or

      • An organization has a deficiency of tax under IRC 507, or an organization has a deficiency of tax under Chapters 41 or 42 of the IRC.

    2. For purposes of IRC 6104(c), a determination is regarded as final when all administrative review with regard to the determination has been completed.

      1. The IRS will not regard a final refusal to recognize a final determination until an organization has exhausted all of its administrative appeal rights or the period for exercising such rights has expired and all administrative review with respect to the determination has been completed. For a definition of determinations see Treasury Regulation 301.6104(c)-1(c).

      2. For purposes of IRC 6104(c), a final determination of a deficiency of tax occurs when the IRS accepts a waiver of restrictions on assessment and collection of a deficiency in tax. When a case is unagreed, a determination is final when we issue the 90-day letter to the taxpayer. When a case is agreed, a determination is final when we issue the examination report to the taxpayer.

  2. APPROPRIATE STATE OFFICIAL:

    1. An appropriate State official for purposes of automatic notification is the State Attorney General, State tax officer, or any State official charged with overseeing organizations of the type described in IRC 501(c)(3). Treasury Regulation 301.6104(c)-1(a)(2) gives other State officials an opportunity to request that they also be automatically notified. (See IRM 7.28.2.4, Notification, for the application process).

  3. NOTIFICATION:

    1. For purposes of IRC 6104(c), notification refers to the IRS's written documentation advising appropriate State officials of final determinations, revocations, or tax deficiencies relating to IRC 501(c)(3).

    2. The documentation, currently sent out monthly by EO designated Notice Coordinators, consists of a cover letter and a list showing the organizations’ names and addresses and the type of determination or the fact of a notice of deficiency.

    3. Appropriate State officials may request that they only be notified with respect to particular organizations or types of organizations or of certain final determinations.

    4. State officials may also change their notification status, requesting that they not be notified or that they renew their notification status.

    5. State officials other than State attorney generals and tax officials, may only make these requests after they have established that they are appropriate State officials.

    6. Notification requirements are described in 301.6104(c)-1. (See IRM 7.28.2.4 for additional information on notifications.)

11.3.33.4.2  (07-01-2006)
Screening the Administrative File

  1. To the extent authorized by IRC 6104(c), the designated EO employee should disclose as much information that is relevant to the IRS's final determination and relevant to the State law determination as possible. However, the designated person may not disclose certain categories of information that are described in Treasury Regulation 301.6104(c)-1(b)(3)(ii). Examples are provided in IRM 7.28.2.6, Screening the Related Administrative Material. If an EO employee, generally the EO "designated person," has questions or requests assistance from GLD, the Disclosure Technical Advisor or Disclosure Manager should provide assistance. It is important that the file is properly purged of non-disclosable information in accordance with Treasury Regulation 301.6104(c)-1(b)(3)(ii), other applicable Federal laws, tax convention provisions, or that which the Commissioner or his/her delegate has determined should not be disclosed (material the disclosure of which would prejudice the proper administration of the internal revenue laws). When responding to requests, EO Notice Coordinators should follow IRM 7.28.2.5, Requests for the Related Administrative Material, and use the letters in IRM Exhibit 7.28.2-8, Acknowledgement and Response to Request for Inspection or Copy of Material Related to an IRC § 6104(c) Notification. If reviewing or assisting, Disclosure Managers should ensure that responses include statements that:

    • the information is Federal tax information being made available only for the purpose specified in the request; and

    • it should be protected from disclosure to or access by unauthorized individuals; and

    • they must notify the IRS of any intent to use all or part of the disclosed information in a State judicial or administrative proceeding.

  2. For additional information on responses to requests, see IRM 7.28.2.5, IRM Exhibit 7.28.2-7, Request for Inspection or Copy of Material Related to an IRC § 6104(c) Notification, and IRM Exhibit 7.28.2-8.

11.3.33.4.3  (07-01-2006)
Use of Information in Judicial or Administrative Proceeding

  1. After giving EO prior notification, an appropriate State official may disclose information obtained under IRC 6104(c) in a judicial or administrative regulatory proceeding regarding the organization to the extent necessary to carry out their statutory responsibilities under State law relating to organizations of the type described in IRC 501(c)(3). The notification is required to allow the IRS to determine if further disclosure should be denied under Treasury Regulation 301.6104(c)-1(b)(3)(ii)(d); that is, if such disclosure would prejudice the proper administration of the internal revenue laws. (See IRM 7.28.2.7, Use of Information in a Judicial or Administrative Proceeding.)

  2. GLD Disclosure Managers and the Disclosure Technical Advisor to TEGE should offer their assistance to EO's designated persons and to appropriate State officials to ensure that information is legally disclosed and is adequately protected. EO designated persons may find GLD assistance especially helpful when they review the material and information that will be used by the State officials in an administrative or judicial proceeding.

11.3.33.4.4  (07-01-2006)
Training

  1. The Office of Disclosure will provide disclosure training to designated persons in EO R&A, Determination and Examination. The training will reduce the risk of inadvertent disclosures during the notification process and will consist of:

    1. General disclosure training, and

    2. Specific disclosure training as it relates to IRC 6104(c), including specific guidance on screening administrative file material.

  2. EO will provide general instructions and training for IRC 6104(c) notifications and the procedures related to the notifications.

11.3.33.4.5  (04-30-2003)
Confidentiality and Recordkeeping

  1. The accounting and recordkeeping requirements of IRC 6103(p) do not apply to IRC 6104(c) disclosures.

  2. Information concerning IRC 501(c)(3) organizations disclosed to State officers under IRC 6104(c), which is otherwise unavailable to the general public, should be protected against unauthorized disclosure.

11.3.33.4.6  (07-01-2006)
Exempt Organization Master File Data

  1. Requests from State or local governments for copies of, or information from, the Exempt Organization/Business Master File (EO/BMF) should be processed in accordance with TEGE IRM 25.7.5, EO Extracts and On-line Programs.

  2. EO/BMF data is available via the Statistics of Income (SOI) website: http://www.irs.gov/taxstats/charitablestats/index.html

    Note:

    Large files organized by individual states can be downloaded from this website.

11.3.33.5  (07-01-2006)
IRMF Data to Welfare Agencies

  1. IRC 6103(l)(7)(B) requires the disclosure of unearned income information to Federal, State, and local agencies administering certain benefit programs. Receiving agencies may not redisclose this information to contractors. The information may only be used to determine eligibility or the correct amount of benefits. This does not include preparation of management reports (even if statistically blurred).

  2. Disclosure of this information is made by the Martinsburg Computing Center from the Information Returns Master File.

  3. Agencies wishing to participate must apply in writing to:

              Director, Office of Governmental Liaison and Disclosure
              Room 1603 IR
              1111 Constitution Ave., NW
              Washington, DC 20224

  4. Publication 3373 explains the procedures for making these disclosures.

  5. Independently corroborated information may be used by the agency consistent with its own confidentiality laws.

  6. These disclosures are subject to the safeguarding requirements of IRC 6103(p)(4) and the Computer Matching Act. See IRM 11.3.39 Role and Responsibilities of Disclosure Managers.

11.3.33.6  (07-01-2006)
Disclosure of IRC 5181 Information

  1. IRC 6103(l)(9) allows for the disclosure of the:

    • name;

    • address; and

    • production premises location(s) of alcohol for fuel producers as defined under IRC 5181.

  2. Disclosures may be made to any State agency, body or commission or its legal representative, charged with the responsibility for the administration of State alcohol laws. The information may only be used for the administration of such laws.

  3. The Alcohol and Tobacco Tax and Trade Bureau is responsible for making these disclosures.

  4. Requests for this information should be signed by the head of the State agency and sent to:

             Administrator
             Alcohol and Tobacco Tax and Trade Bureau
             Washington, D.C.

11.3.33.7  (07-01-2006)
Refund Offsets

  1. IRC 6402(c) allows the Secretary of the Treasury to offset tax refunds against delinquent child support.

  2. The actual offset is made by the Financial Management Service, which handles the payment aspect of refunds/payments. The offsets are coordinated for the states through OCSE.

  3. The disclosures of tax information to OCSE necessary for the offsets is governed by the provisions of IRC 6103(l)(10). This provision sets out the specific tax information that can be disclosed as well as the restrictions on use.

  4. The Office of Safeguards in MA&SS has responsibility to conduct the safeguard reviews of IRC 6103(l)(10) recipients.

11.3.33.8  (07-01-2006)
Disclosure of Returns Filed Under IRC 6050I

  1. Under IRC 6103(I)(15), information from returns filed under IRC 6050I may be disclosed, upon written request, to officers and employees of any Federal agency, or any agency of a State, local or foreign government on the same basis and subject to the same conditions as apply to the disclosure of reports filed under 31 USC 5313 (except that no disclosure shall be made for the administration of any tax law). The Financial Crimes Enforcement Network (FinCEN) administers Title 31 Currency Transaction Report disclosures. On June 25, 2004, FinCEN issued its "Re-Dissemination Guidelines for Bank Secrecy Act Information."

  2. CI is responsible for responding to these requests. The safeguarding provisions of IRC 6103(p)(4) apply to these disclosures.

  3. See IRM 11.3.29, Disclosure to Federal Agencies for Administration of Noncriminal Laws, and IRM 11.3.36, Safeguard Review Program, for more information.

  4. With passage of the Patriot Act, IRC 6050I returns, Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business , are filed effective January 1, 2002 pursuant to both Titles 26 and 31. See IRM 11.3.13.7.6, Title 31 Reports - CTRs, CMIRs, FBARs, and SARs, for a discussion of this change. Most law enforcement agencies should be able to secure post-Patriot Act Forms 8300, directly through FinCEN.


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