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Part 11. Communications and Liaison

Chapter 53. Small Business/Self-Employed

Section 4. GAO/TIGTA/Legislative Implementation

11.53.4  GAO/TIGTA/Legislative Implementation

11.53.4.1  (11-07-2006)
History

  1. The IRS modernization initiative established the Small Business/Self-Employed (SB/SE) Division during FY 2000.

  2. In July 2001, SB/SE established the Customer Liaison Branch to oversee division legislative and audit processes.

  3. In FY 2006 when SB/SE Communications, Liaison and Disclosure (CLD) was reorganized, Customer Liaison Branch became GAO/TIGTA/Legislative Implementation (GTL).

11.53.4.2  (11-07-2006)
GTL Mission

  1. The mission of GTL is to establish and maintain beneficial relationships with Government Accountability Office (GAO), Treasury Inspector General for Tax Administration (TIGTA), Legislative Affairs (LA), Legislative Analysis Tracking and Implementation Services (LATIS), and Taxpayer Advocate Service (TAS) to ensure SB/SE Division compliance with tax law and oversight directives.

  2. GTL is charged with establishing effective programs to facilitate legislative implementation, legislative proposals and GAO/TIGTA audit processes for the SB/SE Commissioner. GTL fosters partnerships with internal and external stakeholders to improve tax administration.

11.53.4.3  (11-07-2006)
GTL Responsibilities

  1. Coordinate and monitor all GAO/TIGTA audit activities throughout SB/SE to:

    1. Maximize positive findings

    2. Identify high-risk issues

    3. Develop corrective actions that properly address recommendations

    4. Establish cordial relationships

  2. Serve as a conduit for information transmitted to GAO and TIGTA and ensure copies for agency historical files.

  3. Serve as the liaison with LA, SB/SE operating units, business operating divisions (BODs) and TAS concerning GAO/TIGTA oversight processes that impact SB/SE.

  4. Serve as the liaison with LATIS, SB/SE operating units, BODs and TAS concerning pending and passed legislation that impacts SB/SE, ensuring that all provisions are assigned and specific actions are created to execute the law.

  5. Monitor the Legislative Implementation Tracking System (LITS) for timely status of legislative provisions and actions.

  6. Serve as the liaison with LA, LATIS, BODs and TAS concerning SB/SE legislative proposals.

  7. Provide internal guidance for developing SB/SE legislative proposals.

  8. Solicit and evaluate the administrative feasibility of SB/SE legislative proposals.

  9. Forward SB/SE legislative proposals having merit through LA for consideration by Treasury.

11.53.4.4  (11-07-2006)
GTL Structure

  1. The Chief, GTL reports to the Director, Policy and Strategic Planning (PSP) in CLD.

  2. The Director, PSP reports to the Director, CLD.

  3. GTL analysts coordinate, implement and monitor the audit and legislative processes for the Commissioner, SB/SE.

  4. Contact information is available on the "SB/SE, CLD, PSP, Contacts" web page at: http://sbse.web.irs.gov/CL2/psp/About/Contacts.htm

11.53.4.5  (11-07-2006)
The GAO/TIGTA Programs

  1. GAO and TIGTA review SB/SE operations then share audit findings and recommendations with Congress, other federal agencies, and the public.

  2. The SB/SE executives place a high priority on audits since findings can significantly impact the IRS' strategic plan and program initiatives.

  3. The goal of GTL is to bring the necessary stakeholders together.

11.53.4.5.1  (11-07-2006)
Roles and Responsibilities

  1. GTL partners with other stakeholders to coordinate the SB/SE GAO/TIGTA Program.

  2. GTL coordinates with the SB/SE business owner to ensure that the:

    1. Scope of the audit is defined

    2. Periodic updates are given

    3. Activities are directed as needed

    4. Responses are prepared in a timely manner

    5. Corrective actions are monitored and implemented timely

    6. All impacted operating divisions have the opportunity to provide input to the response

  3. The business owner responsibilities are to:

    1. Provide GAO and TIGTA with all necessary information during the audit process

    2. Coordinate and arrange the review of cases, databases, etc., deemed appropriate and authorized

    3. Coordinate or elevate preliminary findings/ communicate issues found prior to exit conference - or similar activities.

    4. Prepare the audit response

  4. GAO/TIGTA liaisons in other BODs have oversight responsibility for the coordination, implementation, and monitoring of the GAO/TIGTA audits that impact their organization. When their audits also affect SB/SE, they will coordinate with GTL for input. The reverse is also true.

  5. SB/SE Communications has oversight responsibility for the review/clearance of responses to ensure proper tone, grammar and format.

  6. The SB/SE Commissioner’s staff has oversight responsibility for the review and clearance of responses requiring the SB/SE Commissioner and/or the Deputy Commissioner Services and Enforcement or the IRS Commissioner’s signature.

  7. LA has oversight responsibility for the coordination, implementation, and monitoring of the GAO/TIGTA audit process for the IRS Commissioner. See IRM 11.5.1 for detailed information and Exhibit 11.5.1-1 for basic terms used in the audit program.

11.53.4.6  (11-07-2006)
Government Accountability Office (GAO) Audits

  1. GAO is the investigative arm of Congress. They examine the use of public funds and federal programs. GAO provides analysis, options, and recommendations to Congress for effective oversight, policy, and funding decisions. The GAO website can be found at: http://cl.no.irs.gov/la/BranchC/GAOTIGTA/ARC/program.htm

  2. The GAO audit process includes the following steps:

    1. Entrance Letter

    2. Opening Conference

    3. Audit Review Phase

    4. Exit Conference

    5. Draft Report Phase (30 Day Response)

    6. Final Report Phase (Congressional 60 Day Letter Response)

    7. GAO Response Clearance/Approval Process

  3. The GAO Workflow Process flowchart provides a snapshot overview of the process and can be found at: http://sbse.web.irs.gov/cl2/psp/TGLI/WorkFlow/GAO-WorkFlow.htm

11.53.4.6.1  (11-07-2006)
Entrance Letter

  1. In the majority of cases, the GAO Director of Tax Issues sends a study notification to the National Director, LA, as the designee of the IRS Commissioner, to notify the IRS of a new audit.

    Note:

    Occasionally an audit letter may come from another office within GAO.

  2. The entrance letter, also known as the "Notification Letter, " is the official notification that GAO will conduct a formal audit. LA will forward the entrance letter to the Chief, GTL and other impacted stakeholders to initiate the opening of an audit. The audit is assigned to a GTL staff analyst who serves as the POC throughout the audit process.

  3. LA communication includes:

    1. Entrance letter (see example below)

      Date:
      Mr. Floyd Williams
      National Director, Legislative Affairs Division
      Internal Revenue Service

      Dear Mr. Williams:

      At the request of the Chairman of the Senate Committee on Finance, we are beginning work on capital gains tax noncompliance, under job code XXXXXX. Based on the request, our initial objectives are to provide information on:

      1. How IRS addresses capital gains tax noncompliance for investment income from stocks, bonds, and mutual funds;

      2. What steps, if any, could improve IRS’ ability to address noncompliance for such income and how might they be addressed.


      The Chairman has authorized GAO, pursuant to section 6103(f)(4)(A) of the Internal Revenue Code, to have access to all information necessary to perform this work. A copy of the Chairman’s letter is enclosed.

      We plan to contact representatives from IRS’ National Office in Washington D.C., including the Office of Research, Analysis and Statistics and the National Research Program, and from the research and compliance components of the Wage and Investment and Small Business/Self-Employed Divisions at their headquarters.

      We would appreciate your notifying the appropriate offices in your agency and identifying a point of contact for this engagement. We expect to begin our work immediately and would like to hold the entrance conference as soon as possible.

      If you have any questions please contact _______, Assistant Director at (XXX) XXX-XXXX, xxxx@gao.gov or ____ at (XXX) XXX-XXXX, yyy@gao.gov.

      Sincerely yours,

      ZZZZZ
      Director, Tax Issues
      Strategic Issues Team

      Enclosure

    2. Cover memo – see example located on LA Web site at: http://cl.no.irs.gov/la/BranchC/GAOTIGTA/ARC/handbook/Attachment2.doc

    3. Identification of a contact within LA

    4. Identification of the lead operating division

    5. Specific direction regarding disclosure concerns. For additional information on Disclosure to GAO, refer to IRM 11.3.23.

  4. If the lead operating unit is not identified and/or is in question, the GTL analyst attempts to resolve the issue with the assigned LA point of contact. If the issue cannot be resolved then it is raised to the Chief, GTL for resolution with LA.

11.53.4.6.2  (11-07-2006)
Opening Conference Phase

  1. The GTL analyst performs the following tasks to implement the audit:

    1. Determines the impacted SB/SE business unit(s).

    2. Forwards the entrance letter electronically to all impacted functions, indicating the audit number, title and reply due date on the subject line of the e-mail. The SB/SE business unit ensures the executive or his/her designee participates for their functional area at the opening conference.

      Note:

      The standard language in the example below is used when transmitting the entrance letter:

      Subject line: Action: GAO Job Code, Title, Response Due to GTL XX/XX/XXXX
      GAO is initiating a review on (Audit Title and job code). Legislative Affairs will be scheduling the entrance conference. Please let us know by COB (date) which of the following days you are available: Weekday, XX/XX/XXXX, Weekday XX/XX/XXXX, or Weekday XX/XX/XXXX at Time XX:XX A.M. Attached is the entrance letter and cover memorandum for your review. The entrance letter contains an overview of the scope and objectives for the review.

      If you have any questions, please contact me at (XXX)XXX-XXXX.

    3. Enters the audit on the SB/SE GAO/TIGTA Inventory Tracking spreadsheet and continuously updates the spreadsheet throughout the process.

    4. Forwards the meeting invitation to all impacted stakeholders, encouraging SB/SE executive(s) participation. The executive has the option to appoint a designee within their function/program area to participate in the conference.

    5. Provides a list of participants and briefing notes on the meeting if requested.

11.53.4.6.3  (11-07-2006)
Audit Review Phase

  1. The audit review phase is GAO’s research and information gathering phase.

  2. The GTL analyst:

    1. Follows up with the GAO audit team to determine the status of the audit.

    2. Schedules a meeting (if necessary) to discuss the preliminary audit findings. Audit work papers can be reviewed at this time, if requested.

    3. Updates the audit on the SB/SE GAO/TIGTA Inventory Tracking Spreadsheet.

    4. Maintains records for permanent files.

11.53.4.6.4  (11-07-2006)
Exit Conference Phase

  1. GAO conducts an exit conference on all audits. GAO provides a briefing document for discussion.

  2. The purpose of the exit conference is to discuss and resolve findings and questions contained in the briefing document.

  3. GAO provides an estimate of the number of recommendations that may be included in the draft report. Recommendations are not specifically identified until the draft report is issued.

  4. GAO use this phase to discuss, clarify or correct data and/or significant issues that may be included in the draft report.

  5. The GTL analyst:

    1. Coordinates with LA to schedule the exit conference.

    2. Notifies the impacted SB/SE unit(s) of the scheduled exit conference.

    3. Updates the audit on the SB/SE GAO/Inventory Tracking Spreadsheet.

11.53.4.6.5  (11-07-2006)
Draft Report Phase (30 Day Response)

  1. GAO prepares a draft audit report at the conclusion of an audit, requesting a formal agency response addressing recommendations.

  2. The draft report is assigned a new audit number that Treasury uses to track corrective actions on the Joint Audit Management Enterprise System (JAMES), discussed in See IRM 11.53.4.8.

  3. The IRS Commissioner generally has 30 calendar days to respond to a draft report. However, the GAO required response can be as few as seven calendar days from the date of the draft report if there is a Congressional request for the report. The electronic cover memorandum accompanying the draft report will clearly stipulate the response time required.

  4. SB/SE will provide a response that includes the following:

    1. An agreement or disagreement with finding(s) and recommendation(s)

    2. Highlights of successes, achievements or directives

    3. Corrective actions that address the recommendation(s)

    4. Due date for each corrective action

    5. Identification of a responsible official

    6. Corrective Action Monitoring Plan

      Note:

      Use the following format example to address the Corrective Action Monitoring Plan in the response.

      CORRECTIVE ACTION MONITORING PLAN Examination Planning and Delivery will determine the projected volume of reports that would be tracked along with the cost of establishing a new tracking system and time table for implementation.

  5. The IRS' response to the GAO draft report is addressed to the assigned GAO Director.

  6. The GTL analyst:

    1. Forwards the draft report electronically to the impacted SB/SE business units and BOD(s), indicating the audit title, number and reply due date in the subject line.

    2. Advises the impacted organizations of the pre-established due dates of the response.

    3. Forwards guidance electronically on preparing the response. See IRM 11.53.4.6.6.

      Note:

      The standard language in the example below is used when transmitting the draft report:

      Subject line: Action: GAO Job Code, Audit Title, Response Due to GTL XX/XX/XXXX
      Attached is GAO’s draft report titled Report Title and Job Code. The response is due to GAO on XX/XX/XXXX. To meet GAO’s due date, your response is due to GTL by XX/XX/XXXX. The following information is attached to assist you with the preparation of the response:

      • Response template

      • GAO Audit Response Processing Record

      • Staff Summary Sheet

      • Sample response

        If you have any questions, please contact me at (XXX) XXX-XXXX.

    4. Schedules and coordinates, if necessary, a draft report meeting. Meetings are recommended when the business unit disagrees with documentation in the report, there is disagreement with the ownership of a recommendation, or to ensure agreement with the response.

    5. Identifies program manager responsible for drafting the management response and establish timeframes for completing the response.

    6. Updates the audit on the SB/SE GAO/TIGTA Inventory Tracking Spreadsheet.

    7. Contacts LA to request an extension from GAO if a response cannot be drafted within the required time frame. Contact the PSP Technical Advisor to request an extension on i-trak upon approval of an extension request. Build in a half day for an i-trak update.

11.53.4.6.6  (11-07-2006)
Preparation of the GAO Audit Response

  1. The GTL analyst will coordinate and provide guidance on the preparation of the audit response to the lead SB/SE program owner.

  2. The analyst will provide the following information to the program owner to prepare the response:

    1. GAO response template

    2. Staff summary sheet

    3. Processing record

    4. Draft report

    5. Exit conference or draft report meeting notes, if required

    6. An example of an approved SB/SE GAO response

  3. The SB/SE program owner should prepare the response with the following in mind:

    1. Use appropriate correspondence format. See IRM 1.10.1 , The IRS Correspondence Manual and IRM 1.10.2 , Reference Materials for Preparing Correspondence, for guidance

    2. Write using a positive tone

    3. Agree or disagree with recommendation(s) in the first few paragraphs

    4. Address the recommendation and what corrective action are to be been taken

    5. State positive results and/or next steps that address the recommendation(s)

    6. Estimate a realistic implementation date to complete the recommendation(s) See IRM 11.53.4.6.7. for guidance

    7. Identify the responsible official (BOD executive) for the recommendation(s)

    8. State how the progress of the recommendation(s) will be monitored

    9. Identify the appropriate program manager and executive approval See IRM 11.53.4.6.9. for response clearance/approval guidance.

11.53.4.6.7  (11-07-2006)
Establishing Realistic Corrective Action Due Dates

  1. SB/SE’s goal is to establish achievable corrective action due dates. All implementation dates are on the 15th of the month. Delaying actions should be rare; however, certain delays, such as those relating to funding and Request for Information Systems (RIS) prioritization, may be necessary.

  2. To ensure achievable due dates, the GTL analyst will advise the SB/SE business units to:

    1. Brainstorm when findings and recommendations are first presented

    2. Discuss and evaluate each recommendation

    3. Consider all obstacles when establishing due dates

    4. Consider drafting a timeline including major milestone dates to arrive at the completion date

    5. Add additional time to allow for unforeseen obstacles

  3. For consistency throughout SB/SE, use the 15th of the month as the due date for all corrective actions.

11.53.4.6.8  (11-07-2006)
Final Report Phase (Congressional 60 Day Letter Response)

  1. The final report phase (Congressional 60 day letter response) is somewhat similar to the GAO draft report phase, except the agency must prepare a response for Congressional committee members. See the LA website for the GAO 60 Day Letter List of Chairmen and Ranking Members at: http://cl.no.irs.gov/la/BranchC/GAOTIGTA/ARC/handbook/Attachment12.doc

  2. GAO issues the final report that includes the agency's official response to the draft report.

  3. The final report audit number remains the same as the draft report.

  4. The GTL analyst provides a copy of the final report to the impacted SB/SE business unit(s).

  5. Recommendations and corrective actions included in the final report are input on JAMES. See IRM 11.53.4.8. for additional information on JAMES.

11.53.4.6.9  (11-07-2006)
GAO Response Clearance/Approval Process

  1. The GTL analyst prepares the Staff Summary Sheet and forwards it to the lead SB/SE business unit to initiate the clearance and approval process for an audit response.

  2. The GTL analyst includes the following individuals and information on the Staff Summary Sheet for review and approval:

    1. Responsible SB/SE Director

    2. Responsible Program Manager

    3. LA GAO/TIGTA Coordinator

    4. SB/SE Communications Reviewer

    5. Chief, GTL

    6. Director, PSP

    7. Senior Operations Advisors, CLD

    8. Director, CLD

    9. Executive Assistant, SB/SE Executive Staff

    10. SB/SE Deputy Commissioner

    11. SB/SE Commissioner

    12. File names (short and descriptive) such as Audit number, Shortened Title Draft Report.doc or Audit number, Shortened Title IRS Response.doc

    13. Document Subject Line should read: Review: Audit number, Shortened Title Response Due to GTL XX/XX/XXXX or Approval: Audit number, Shortened Title Response Due XX/XX/XXXX (To Director, PSP/Director, CLD & Above)

    14. Document Summary/Note to Reviewer Line should read: This response was developed by SB/SE, Title of director/function

    15. i-trak control number

  3. The lead SB/SE business unit initiates the clearance process for the response via e-mail.

  4. The lead SB/SE business unit obtains review and approval from the following individuals:

    1. SB/SE Program Manager

    2. Director and/or Program Manager of other impacted BODs

    3. SB/SE Director

  5. The GTL analyst continues the clearance process for the response through:

    1. LA and SB/SE Communications (simultaneous clearance review of the response)

    2. Chief, GTL (consolidation and review of the response)

    3. Director, PSP (review of the response)

    4. Senior Operations Advisors, SB/SE CLD (review & finalize the response with SB/SE business unit)

    5. Director, CLD (review of the response)

    6. Executive Assistant, SB/SE Executive Staff (review of the response for the SB/SE Commissioner's approval)

    7. SB/SE Deputy Commissioner (signature approval for the SB/SE Commissioner, if required)

    8. SB/SE Commissioner (signature approval)

  6. LA continues the clearance process for the response through Deputy Commissioner to obtain the IRS Commissioner’s approval and signature.

11.53.4.7  (11-07-2006)
Treasury Inspector General for Tax Administration (TIGTA)

  1. TIGTA established in January 1999 in accordance with the IRS Restructuring and Reform Act of 1998 (RRA 98) provides independent oversight of IRS activities. As mandated by RRA 98, TIGTA assumed most of the responsibilities of the IRS’ former Inspection Service. For additional information, see the TIGTA Web site at: http://www.treas.gov/tigta/about_what.html

11.53.4.7.1  (11-07-2006)
TIGTA Audit Program

  1. The TIGTA audit program is comprised of reviews mandated by statute or regulations, as well as reviews identified through the audit planning and evaluation process.

  2. The TIGTA audit program is presented in the Annual Audit Plan published at the beginning of each fiscal year.

11.53.4.7.2  (11-07-2006)
TIGTA Audit Plan

  1. The Annual Audit Plan is based on significant management issues facing IRS, as well as areas of concern from Congress, the IRS Commissioner and IRS Oversight Board. Emphasis is placed on the statutory coverage imposed by RRA 98.

11.53.4.7.3  (11-07-2006)
TIGTA Workflow Process

  1. TIGTA audits provide independent oversight of IRS activities to promote efficiency and effectiveness in administering the nation’s tax system.

  2. The Office of Audit strategically evaluates IRS programs, activities and functions so that resources are expended to reduce vulnerabilities in the nation’s tax system.

  3. The TIGTA Workflow Process flowchart provides a snapshot overview of the process and is available for review at: http://sbse.web.irs.gov/CL2/psp/TGLI/WorkFlow/TIGTA-WorkFlow.htm.

  4. The TIGTA process includes the following steps:

    1. Research Project

    2. Engagement Letter

    3. Opening Conference Phase

    4. Audit Phase

    5. Closing Conference

    6. Discussion Draft Report

    7. Draft Report (30 day Response)

    8. Final Report

11.53.4.7.4  (11-07-2006)
TIGTA Research Project Initiation

  1. TIGTA contacts LA via an e-mail or memorandum indicating the scope of work and the anticipated time frames involved for the research project. Engagement letters are not required for these TIGTA audit activities which include audit planning, research activities (surveys, information gathering, etc.), and integrity projects.

    Note:

    The following standard language is used by TIGTA to transmit a research request.

    This e-mail is to inform you that we are beginning research into the progress being made to increase the accuracy of social security numbers reported on information return documents. The work will be conducted under project code (audit number). We anticipate that the work will take about two months during which time we'll decide whether to initiate a formal review over the area. If we decide to initiate such a review, we will issue an engagement letter outlining our objectives and scope for the review.

    In conjunction with our research work, we would appreciate you notifying officials of our plans and identifying a point of contact. We would like to hold discussions with appropriate officials as soon as possible. If you or others have questions, please contact Senior Auditor (XXX) XXX-XXXX.

  2. LA forwards the e-mail to the Chief, GTL.

  3. The Chief, GTL assigns the research project to a GTL analyst and informs the LA POC.

  4. The GTL analyst:

    1. Advises TIGTA that he/she is the liaison and coordinates the research request.

    2. Forwards the e-mail to the responsible SB/SE business unit designee to obtain a POC who will work with TIGTA to address the research request.

    3. Provides the POC to TIGTA. TIGTA will coordinate the audit through the GTL analyst to obtain information unless otherwise directed.

    4. Enters the status of the research project on the SB/SE GAO/TIGTA Inventory Tracking Spreadsheet.

  5. If the research results in a formal audit, TIGTA will issue an engagement letter through LA. The GTL analyst assigned to the research project will retain the responsibility for overseeing the audit.

  6. If an audit is not warranted, the research project is closed by a TIGTA memorandum.

11.53.4.7.5  (11-07-2006)
Engagement Letter

  1. To initiate an audit, TIGTA notifies the IRS through the issuance of an engagement letter from the Deputy Inspector General for Audit to the Director(s) of the BOD(s) that is forwarded to LA as the designee of the Commissioner of the IRS.

  2. The engagement letter is the official notification that a formal audit will be conducted.

  3. The engagement letter contains the following information:

    1. Title

    2. Audit Number

    3. Scope of the review

    4. Objective of the review

    5. Offices included in the review

    6. Deliverables and estimated completion dates

    7. TIGTA executives and other points of contact

      Note:

      The following standard language is used by TIGTA when transmitting an engagement letter.

    MEMORANDUM FOR COMMISSIONER, SMALL BUSINESS/SELF-EMPLOYED DIVISION

    FROM: xxxxxxxxxxxxxxxxx
    Deputy Inspector General for Audit

    SUBJECT: Denials of Written Requests for Information (Audit # XXXXXXXXX)

    The Treasury Inspector General for Tax Administration (TIGTA) is initiating a review to evaluate the Internal Revenue Service’s (IRS) denials of written requests for information. This audit is being conducted because the Restructuring and Reform Act of 1998 requires the TIGTA to conduct periodic audits of a statistically valid sample of the total number of determinations made by the IRS to deny written requests to disclose information to taxpayers on the basis of the Internal Revenue Code (I.R.C.) § 6103 or the Freedom of Information Act (FOIA) exemption (b)(7). We will be contacting the TIGTA Liaison for the Small Business/Self Employed Division to schedule an entrance conference with the appropriate IRS managers. To allow the posts-of-duty sufficient time to respond to our request for copies of sample cases, we will wait to schedule the entrance conference until (month, year).

    Overall Objective

    The overall objective of our audit is to determine if the IRS improperly withheld information requested by taxpayers in writing, based on FOIA exemption (b)(3), in conjunction with I.R.C. § 6103, and/or FOIA exemption (b)(7), or by replying that responsive records were not available.

    Offices Subject to Review

    On-site visitations will be within the Small Business/ Self-Employed Division’s Office of Governmental Liaison & Disclosure. We will also select a sample of denials of written requests for information that have been closed by all Disclosure Offices from (month, day, year) through (month day, year).

    Deliverables and Estimated Completion Dates

    Draft Report issued by (month date, year)
    Final Report issued by (month date, year)

    Information Needed From Auditee

    To accomplish the audit objectives, we require the following information:

    • An extract from the Electronic - Disclosure Information Management System (E DIMS) of all cases closed from (month day, year) to (month day, year). (A separate memorandum will be sent to you detailing our criteria for the extract.)

    • Copies of case files for a sample of cases that will be selected from the above extract



    Designated Treasury Inspector General for Tax Administration Executive Liaison xxxxxxxxxxx, Assistant Inspector General for Audit (Headquarters Operations and Exempt Organizations Programs), xxx xxx-xxxx

    Responsible Inspector General Staff

    Questions regarding this review may be directed to:
    xxxxxxxxxxx, Director, (xxx) xxx-xxxx
    xxxxxxxxxxx, Auditor Manager, (xxx) xxx-xxxx
    xxxxxxxxxxx, Lead Auditor, (xxx) xxx-xxxx
    xxxxxxxxxxx, Senior Auditor, (xxx) xxx-xxxx

  4. LA forwards the engagement letter to the Chief, GTL with a cover memorandum from the Director, LA Division. The cover memorandum identifies operating divisions or business units TIGTA expects to contact and an LA POC.

  5. Chief, GTL assigns the audit to a GTL analyst and informs LA.

  6. GTL analyst informs TIGTA via e-mail of the assignment, establishes a relationship and requests available dates for an opening conference.

11.53.4.7.5.1  (11-07-2006)
Lead Process

  1. When SB/SE has been assigned as the lead organization, the GTL analyst identifies the appropriate SB/SE business unit, SB/SE program owner and other impacted BOD(s) based on the audit objective.

  2. The assigned analyst electronically forwards the engagement letter to all impacted functions and the SB/SE executive designee regarding the initiation of an audit. Included on the subject line of the e-mail are the audit number, title, and reply due date.

    Note:

    The standard language in the example below is used when transmitting the engagement letter to the SB/SE lead directorate and other impacted BODs to establish a meeting date for the opening conference.

    Subject line: Action: TIGTA Audit Number, Audit Title, Response Due to GTL XX/XX/XXXX
    TIGTA is initiating a review on Audit Number, Title. The Commissioner, Small Business/Self-Employed Division is the lead stakeholder. Attached is the engagement letter and cover memorandum from LA for your review. Please provide the following information to me by COB XX/XX/XXXX:

    • Confirmation that your area is responsible for the above subject audit.

    • Name and telephone number of the responsible individual(s) that should attend the opening conference.

    • Your availability to participate in the opening conference.



    The proposed dates for the opening conference are as follows:

    1. Weekday, XX/XX/XXXX (Time AM or PM EST)

    2. Weekday XX/XX/XXXX (Time AM or PM EST)



    Please let me know which date above accommodates your schedule. I will forward an e-mail meeting invitation with the location and conference call information for the opening conference once your reply is received.

    If you have any questions, please contact me at (XXX)XXX-XXXX.

  3. The GTL analyst enters the audit on the SB/SE GAO/TIGTA Inventory Tracking spreadsheet.

11.53.4.7.5.2  (11-07-2006)
Non-Lead Process

  1. When another BOD has been identified as the lead, the lead BOD liaison coordinates the opening conference.

  2. The GTL analyst:

    1. Identifies the appropriate SB/SE business unit and program owner impacted by the audit objectives.

    2. Coordinates with the lead BOD liaison, advising him/her of SB/SE participation and obtaining potential opening conference dates.

    3. Electronically forwards the engagement letter and provides proposed dates, when available, for the opening conference to SB/SE business unit executive designee(s). Include the audit number, title and the reply due date on the subject line of the e-mail.

      Note:

      The standard language in the example below is used when transmitting the engagement letter to the SB/SE business unit on non-lead audits to establish a meeting date for the opening conference.

      Subject line: Action: Audit Number, Title, Response due to GTL XX/XX/XXXX
      TIGTA is initiating a review on (Audit Number and Title). The TIGTA review is assigned to the Director, Office of Professional Responsibility, and Commissioner, Small Business/Self-Employed Division. The Director, Office of Professional Responsibility is the lead stakeholder.

      Attached is the engagement letter and cover memorandum for your review. Please provide the following information by COB XX/XX/XXXX:

      • Confirm that you (or your designee) will participate in the opening conference

      • Provide any additional POCs that should attend the opening conference with names and telephone numbers

      • Provide your availability for the dates proposed:

      • Weekday, XX/XX/XXXX, (Time AM or PM EST)

      • Weekday, XX/XX/XXXX (Time Am or PM EST)



      I will forward an e-mail meeting invitation with the location and conference call information for the opening conference once it is received from the lead stakeholder.

      If you have any questions please contact me at (XXX) XXX-XXXX.

    4. Forwards a meeting invitation to POCs upon receipt from the lead BOD liaison.

    5. Enters the audit on the SB/SE GAO/TIGTA Inventory Tracking.

11.53.4.7.6  (11-07-2006)
Opening Conference Phase

  1. If SB/SE is the lead on an audit, the GTL analyst schedules the opening conference with the SB/SE business unit and other impacted BOD(s). It is the responsibility of the SB/SE business unit executive designee to ensure that an executive from their functional area participates at the opening conference.

  2. The GTL analyst performs the following tasks to implement the audit:

    1. Forwards the engagement letter electronically to all impacted functions. Include the audit number, title and the reply due date on the subject line of the e-mail.

    2. Forwards a meeting invitation to all impacted stakeholders and encourages SB/SE executive(s) participation. The executive has the option to appoint a designee within their function/program area to participate in the conference.

    3. Provides a list of participants and briefing notes on the meeting if requested.

    4. Updates the audit on the SB/SE GAO/TIGTA Inventory Tracking Spreadsheet.

11.53.4.7.7  (11-07-2006)
Audit Review Phase

  1. The TIGTA audit review phase is the same as the GAO audit review phase. See IRM 11.53.4.6.3.

11.53.4.7.8  (11-07-2006)
Exit Conference Phase

  1. The TIGTA exit conference phase is the same as the GAO exit conference phase except that TIGTA may identify potential recommendations. See IRM 11.53.4.6.4.

11.53.4.7.9  (11-07-2006)
Discussion Draft Report Phase

  1. TIGTA issues a discussion draft report after the conclusion of the exit conference.

  2. The discussion draft report identifies findings and recommendations and provides a snapshot of the potential draft report that will require an official response from IRS.

  3. A meeting may be held during the discussion draft report phase.

  4. The purpose of the discussion draft report meeting is to bring all impacted stakeholders together to discuss the audit findings, recommendations, and issues of concern and to validate the responsible officials.

  5. TIGTA's audit work papers may be reviewed at this time, if requested.

  6. A pre-discussion draft meeting based on the report findings and recommendations is at the discretion of the SB/SE program owner and other impacted BODs. The purpose of the pre-discussion draft meeting is to discuss and coordinate the agency’s position on the findings and recommendations.

  7. If there are no recommendations and the discussion draft report is positive, it will be at the discretion of the program owner and other impacted BODs whether a meeting with TIGTA is necessary.

  8. The GTL analyst will:

    1. Coordinate with TIGTA and schedule a discussion draft meeting within 5 work days from receipt of the discussion draft report, if requested.

    2. Ensure the responsible executive(s), program owner(s) and manager(s) participate in the discussion draft report meeting.

      Note:

      The standard language in the examples below is used when forwarding the discussion draft report and meeting invitation.

      Subject line: Action: Audit Number, Title, Response Due to GTL XX/XX/XXXX
      Attached is the discussion draft report for Audit Number, Title. Please review the report and let me know by COB XX/XX/XXXX if a discussion draft report meeting is needed and forward all negative responses from your executive or program manager to me by e-mail.

      If you have any questions please contact me at (XXX) XXX-XXXX.

      Subject line: Action: Audit Number, Report Title
      Location: Room, Conference Call Number, Access Code
      Attached is the discussion draft report for TIGTA Audit Number and Title. The conference call information is provided below:

      Conference call Number: XXX-XXXX
      Access Code: XXXXX
      Contact person: (GTL Analyst Name)

      If you have any problems accessing the conference call, please contact the Treasury operator at (XXX) XXX-XXXX.

    3. Coordinate with the SB/SE program owner and SB/SE Research to ensure outcome measures are accurate. Validate any sample methodology and sample size mentioned in the report and address concerns during the discussion draft meeting.

    4. Invite SB/SE Division Counsel, Disclosure and Office of Burden Reduction to the discussion draft report meeting to address recommendations for legislative proposals, regulatory or legal guidance, or disclosure and privacy issues, if needed.

    5. Invite Modernization Information Technology Systems (MITS) and Business System Planning (BSP) to every discussion draft report meeting with recommendations impacting IRM procedures, electronic or paper returns processing or posting, command codes, Master File or systemic adjustments, notice issuance, or re-engineering of business processes.

    6. Ensure objectives of the audit findings, recommendations, and ownership are addressed during the discussion draft report meeting. Internal ownership issues (lead/non-lead) on an audit are discussed off-line between SB/SE and the other BODs. If the GTL analyst cannot resolve the issue, elevate it to the Chief, GTL for a resolution with LA.

    7. Provide briefing notes on the discussion draft report meeting identifying significant issues addressed/agreed upon.

    8. Request an e-mail from the SB/SE business unit's executive, designee, or program manager validating their decline of a discussion draft report meeting.

    9. Update the audit on the SB/SE GAO/TIGTA Inventory Tracking Spreadsheet.

11.53.4.7.10  (11-07-2006)
Draft Response

  1. GTL will coordinate and provide guidance on the preparation of the audit response to the lead SB/SE program owner immediately after the discussion draft report meeting is held or declined.

  2. The GTL analyst will provide the following information to the SB/SE program owner for preparation of the response:

    1. TIGTA response template

    2. Staff summary sheet

    3. Processing record

    4. Discussion draft report

    5. Discussion draft meeting notes, if required

    6. An example of an approved SB/SE TIGTA response

  3. The SB/SE program owner should prepare the response using the same guidelines identified under the Preparation of the GAO Audit Response. See IRM 11.53.4.6.6.

  4. The SB/SE program owner is required to address all monetary outcome measures in the response.

  5. The GTL analyst updates the audit on the SB/SE GAO/ Inventory Tracking Spreadsheet.

  6. The TIGTA Draft Report Phase is the same as the GAO Draft Report Phase. See IRM 11.53.4.6.6.

  7. For guidelines on establishing a due date for a corrective action See IRM 11.53.4.6.7.

11.53.4.7.11  (11-07-2006)
TIGTA Response Clearance/Approval Process

  1. The TIGTA response clearance/approval process is similar to GAO’s. However, the signature approval on the response usually concludes with the SB/SE Commissioner unless the audit is on a on a very high profile matter and/or impacts multiple BODs, which would require the IRS Commissioner’s signature or Deputy Commissioner Services and Enforcement. See IRM 11.53.4.6.9.

11.53.4.7.12  (11-07-2006)
Final Report

  1. TIGTA issues the final report which includes the agency’s official response to an audit.

  2. The final report is assigned a new audit number.

  3. The recommendations and corrective actions included in the final report are input on the Joint Audit Management Enterprise System (JAMES). See IRM 11.53.4.8.

  4. The GTL analyst provides a copy of the final report to the impacted SB/SE business unit(s) and updates the SB/SE GAO/TIGTA Inventory Tracking Spreadsheet.

11.53.4.8  (11-07-2006)
Joint Audit Management Enterprise System (JAMES)

  1. JAMES is the Treasury Department database which contains tracking information on GAO and TIGTA audit reports from issuance through completion of all actions required to address all findings and recommendations contained in a report.

  2. It also tracks Federal Financial Management Improvement Act (FFMIA) material weaknesses, reportable conditions, and remediation plan actions.

  3. JAMES provides numerous statistical and information reports that are used to gauge timely completion of corrective actions.

11.53.4.8.1  (11-07-2006)
Roles and Responsibilities

  1. SB/SE reports to the Financial Management Controls (FMC) Executive Steering Committee (ESC) which is chaired by the Chief Financial Officer (CFO). The FMC ESC provides leadership and oversight over important cross-functional issues and areas such as:

    1. GAO and TIGTA audit findings

    2. The Financial Statement Audit

    3. Material weaknesses which are significant deficiencies of sufficient importance to be reported annually to the Department of Treasury and, ultimately, to the President and Congress until corrected

    4. Reportable conditions which are control deficiencies with executive oversight by the FMC ESC

    5. The Federal Managers’ Financial Integrity Act (FMFIA) established procedures for identification of material weaknesses and the plans for correcting them

    6. The FFMIA established the requirement for remediation plans when agency financial systems do not comply with federal government requirements. Plans include remedies, resources, and target dates for achieving compliance.

  2. SB/SE participates in bi-monthly FMC ESC meetings to review:

    1. Progress in correcting material weaknesses as well as implementing remediation plans and reportable condition action plans.

    2. Progress in correcting issues of non-compliance with laws and regulations

    3. Timely completion of material weaknesses, remediation plans, and audit corrective actions.

  3. GTL coordinates with the Office of Internal Controls (OIC), who on the behalf of the CFO:

    1. Monitors the completion of corrective actions for material weaknesses, reportable conditions, and audit corrective actions

    2. Ensures JAMES is updated timely

    3. Provides assistance to managers and JAMES coordinators

    4. Reviews and validates BOD updates to corrective actions.

  4. The GTL JAMES coordinator is responsible for:

    1. Maintaining spreadsheets of open corrective actions for each business unit which are reviewed by each unit on a continuous basis.

    2. Coordinating a monthly review of open corrective actions by business units to facilitate timely completion.

    3. Coordinating timely reporting on completed or rescheduled corrective actions.

    4. Updating JAMES when audit corrective actions are completed or rescheduled.

    5. Providing guidance in establishing realistic due dates during the preparation of official responses.

11.53.4.9  (11-07-2006)
SB/SE Legislative Program

  1. In July 2001, GTL, then known as the Customer Liaison Branch, established the legislative program for SB/SE. The program consists of two processes:

    1. Legislative implementation

    2. Legislative proposals

  2. GTL has oversight and liaison responsibility for coordinating, implementing, and monitoring the SB/SE legislative process, which includes:

    1. Coordinating the implementation of all new legislation that impacts SB/SE by ensuring all legislative provisions are assigned and specific actions are developed to execute each new tax law.

    2. Updating and monitoring the Legislative Implementation Tracking System (LITS) for timely completion of SB/SE legislative provisions and action items. This includes appropriations directives that affect SB/SE.

    3. Assisting in requests for researching pending and current legislation.

    4. Providing guidance through LA for the development and preparation of SB/SE legislative proposals.

    5. Facilitating through LA, Congressional requests for SB/SE technical and statistical information.

11.53.4.9.1  (11-07-2006)
Roles and Responsibilities

  1. GTL partners with other organizations to assist in the coordination of the SB/SE Legislative Implementation Program.

    1. GTL coordinates with LA which has oversight responsibility for reviewing legislative proposals and developing legislation, coordinating legislation with Treasury and Congress, reviewing Congressional testimony, attending hearings, and monitoring legislation through passage for the IRS Commissioner.

    2. GTL coordinates with the Legislative Analysis Tracking and Implementation Services (LATIS) which has servicewide oversight responsibility for the legislative implementation process.

  2. LATIS performs the following task:

    1. Analyzes and monitors pending legislation

    2. Coordinates the implementation of enacted legislation

  3. GTL coordinates the legislative process with:

    1. Other functions within SB/SE

    2. Other functions within IRS

    3. The SB/SE Commissioner’s Staff which has oversight responsibility for the preparation of Congressional Testimony

    4. SB/SE Communications which has oversight responsibility for preparing legislative communication plans for all new SB/SE-impacted legislation during the implementation process. This includes coordinating with Communications & Liaison (C&L) on external communication and preparation of internal communication for the SB/SE staff.

    5. The SB/SE business units which create legislative proposals as well as develop and monitor legislative implementation action plans for their specific programs.

    6. SB/SE Learning and Education which has oversight responsibility for developing training related to all new legislation that impacts SB/SE.

11.53.4.10  (11-07-2006)
Legislative Implementation

  1. LATIS monitors legislative bills as part of its oversight and coordination role. LATIS analyzes and tracks developing legislation that may impact IRS programs until Congress suspends activity on the bill or passes it.

    1. Pending bills are those being formulated or considered for passage by Congressional Subcommittees, Congressional Committees, Conference Committee, U.S. House of Representatives or U.S. Senate. Pending bills are those which have not been signed into law by the President.

    2. Legislative bills of greatest interest to Treasury and IRS progress through the House Ways and Means Committee and the Senate Finance Committee to enactment by the full Congress.

  2. If LATIS requests that the BODs review developing legislation, the Chief GTL designates a GTL analyst to oversee SB/SE review.

  3. The GTL analyst performs the following tasks:

    1. Enters assigned legislation on GTL’s "Legislative Implementation – Enacted Legislation" inventory tracking spreadsheet to monitor progress.

    2. Distributes proposed legislation to the directorates

    3. Requests SB/SE impact analysis

    4. Provides an input format

    5. Prescribes a deadline for review.

      Note:

      Reviews may occur more than once as a bill develops, and may occur during one or more years.

    6. Collects SB/SE business unit input, consolidates it and forwards it through SB/SE management clearances to LATIS. The analyst also maintains an archive of this input.

  4. Enacted legislation becomes law after it has passed both Houses of Congress and is signed by the President.

  5. LATIS notifies the BODs of enacted legislation and posts information about the new legislation to its website at: http://nhq.no.irs.gov/lits/

  6. Soon after enactment, LA posts a synopsis of new legislation to its website at: http://cl.no.irs.gov/la/BranchC/Legislation/Index.htm

  7. The GTL analyst forwards the enacted legislative text and related background materials to the SB/SE business units for analysis after notification has been received from LATIS.

  8. LATIS organizes and conducts a servicewide meeting for all BODs to brief, assign and coordinate provision ownership after new legislation is enacted.

  9. The GTL analyst extends the meeting invitation to the impacted SB/SE business unit to address provision ownership in the early stages of the implementation process.

  10. During the servicewide meeting, LATIS:

    1. Provides the legislative text and information summarizing the legislative changes.

    2. Distributes a chart to the BODs showing the title, effective date and tentative BOD ownership for each legislative provision.

    3. Assigns BOD ownership for each new legislative provision at the meeting.

    4. Inputs all new provisions to LITS, showing the BOD owner for each.

  11. The GTL analyst:

    1. Schedules an SB/SE meeting to discuss implementation after the servicewide LATIS implementation meeting.

    2. Issues a meeting invitation to all SB/SE business units and SB/SE Division Counsel.

    3. Also invites LATIS representatives, BOD legislative liaisons and BOD subject matter experts as appropriate, for coordination purposes.

    4. Facilitates the SB/SE implementation meeting to provide a legislative overview, assign each provision to an SB/SE business unit and ensure coordination with the other BODs.

    5. Requests during the meeting, a list of actions required to implement new legislative requirements from each business unit and prescribes a due date for input.

  12. SB/SE business units are responsible for:

    1. Analyzing the new legislation

    2. Determining how the new legislative requirements will impact their programs

    3. Identifying the implementation actions items associated with each legislative provision.

  13. Specific implementation actions typically include forms and publications changes, legal advice or regulations, Request for Information Services/Statement of Work (RIS/SOW), and IRM updates.

  14. SB/SE business units create a list of action items associated with each provision. The units provide the following information for each action item:

    1. Description of the specific program action resulting from the new legislative requirement

      Example:

      "Updating IRM X.XX to reflect new notice requirements," ;"Submitting Request for Information Services to create new start date field for special interest computation," , etc.

    2. The type of action to be taken

      Example:

      SB/SE Division Counsel guidance, IRM update, Request for Information Services, training.

    3. Identification of the subject matter expert (and their organization symbol) responsible for completing each action

    4. Estimated completion date for the action

    5. Outline of the contingencies which may delay implementation activity

      Example:

      Dependencies upon SB/SE Division Counsel guidance, preliminary research studies, computer programming, pilot testing, phased modernization, bilateral federal agency MOU, etc.

  15. SB/SE business units forward this information to the GTL analyst by the required due date.

  16. SB/SE Communications and HQ Learning & Education develop legislative communication plans that outline key messages, communication vehicles and training needs.

  17. GTL suspends the monitoring process for legislation not enacted. If pending legislation does not pass both Houses of Congress or is not enacted by Presidential signature during a Congressional session, GTL:

    1. Archives SB/SE business unit review input for comparison with future versions of a legislative bill.

    2. Initiates additional SB/SE business unit review if the legislative bill receives Congressional consideration during a subsequent year.

  18. The Legislative Implementation Workflow Process flowchart provides a snapshot overview of the process and can be found at: http://sbse.web.irs.gov/CL2/psp/TGLI/WorkFlow/Legis/Implementation-WorkFlow.htm

11.53.4.11  (11-07-2006)
Legislative Monitoring

  1. The GTL analyst inputs implementation action items obtained from the SB/SE business units on LITS. The LITS website can be found at: http://nhq.no.irs.gov/lits/

  2. LITS also includes certain recurring legislative requirements, which must be completed on a periodic basis (such as quarterly or annual Foreign Bank and Financial Account Reports (FBAR) reports to Congress). These actions are monitored by LATIS and i-trak controls are issued to the BODs for regular status updates.

  3. LITS does not include Congressional inquiries and Joint Committee inquiries, although these are sometimes related to pending or passed legislation. LA originate i-trak controls for BOD responses to such correspondence.

  4. The assigned GTL analyst:

    1. Monitors SB/SE-owned provisions and action items

    2. Coordinates meetings as needed to discuss action items

    3. Sends a monthly reminder alert for each legislative act to the SB/SE business units, requesting updated status information for SB/SE-owned provisions and action items, at least one week in advance of the LITS status due date

    4. Updates LITS on a monthly basis, unless legislation implementation is completed, on dates prescribed by LATIS and posted on their website

    5. Reports all "yellow" and "red" overdue items to the SB/SE Commissioner on a monthly basis, for discussion at servicewide Enforcement Committee Meetings. GTL also reports these items to SB/SE management through CLD input to the Business Performance Review (BPR).

  5. SB/SE business units are responsible for providing updates on SB/SE-owned provisions impacting their function until actions are completed. Updated information should:

    1. Describe activity on each action item since the last monthly update

    2. Outline contingencies which may delay implementation activity

      Example:

      Dependencies upon SB/SE Division Counsel guidance, preliminary research studies, computer programming, pilot testing, phased modernization, bilateral federal agency MOU, etc.

    3. Provide rationale for delayed or late completion

    4. Estimate completion date for delayed or late actions

    5. Explain program, budget, and/or taxpayer burden impacts due to delayed or late action

11.53.4.12  (11-07-2006)
Legislative Research

  1. LA monitors the progress of proposed legislation through the clearance and submission process. GTL coordinates with LA to determine the status of proposed legislation submitted for Treasury or Congressional consideration.

  2. LA and LATIS monitor pending legislation:

    1. The LATIS website at: http://nhq.no.irs.gov/lits carries a link for reviewing the status of legislation currently being considered by Congress.

    2. The status of pending legislation can also be reviewed by any IRS employee accessing the Intranet at http://irweb.irs.gov/ selecting "Research" , then selecting "THOMAS" and entering a key word search.

  3. LATIS distributes information to the BODs concerning enacted legislation. LATIS or GTL can assist with SB/SE legislative research.

    1. The LATIS website at: http://nhq.no.irs.gov/lits carries a link for reviewing recently passed legislation.

    2. The status of recently passed legislation, legislative history and complete legislative language can also be reviewed by any IRS employee accessing the Internet at: http://irweb.irs.gov/ selecting "Research" , then selecting "THOMAS" and entering a key word search.

    3. IRS employees can also review legislation by accessing the Intranet at: http://irweb.irs.gov/ , selecting "Search" , and entering a key word search for "United States Code." Several sources will be identified. When one of these is selected, the employee can enter a topical key word search, such as "Passport Penalty" or "Extension Due Dates" for further information.

11.53.4.13  (11-07-2006)
SB/SE Legislative Proposals

  1. Legislative proposals are suggestions solicited or unsolicited from both internal and external partners or stakeholders to further the objectives of the IRS Strategic Plan such as reducing the tax gap by improving service and voluntary compliance. Some suggestions may also involve improving a work process or reducing taxpayer burden.

  2. The assigned GTL analyst has oversight responsibility for monitoring, tracking, reviewing, and coordinating with SB/SE customers, SB/SE Division Counsel, and Disclosure, to ensure approved proposals get through the clearance process.

  3. Legislative proposals may be provided in two ways:

    1. Internal partners may include SB/SE customers, other IRS BODs, the SB/SE Commissioner, and the IRS Commissioner.

    2. External partners and stakeholders include practitioners, Treasury, and Congress.

11.53.4.13.1  (11-07-2006)
SB/SE Proposal Process

  1. The SB/SE legislative proposals process serves two purposes:

    1. Provides a resource for the SB/SE Commissioner’s Office for executive and Treasury consideration that have the potential to close the tax gap.

    2. Provides a vehicle for other changes identified by the SB/SE business units.

  2. The SB/SE legislative proposal process involves the following:

    1. GTL sends the "SB/SE Quarterly Legislative Proposal Request " each quarter to all SB/SE business units canvassing for proposals that may warrant consideration by Treasury and Congress. The request provides links to the legislative guidelines, template, and a sample legislative proposal which provide useful information to help develop a proposal. These links can be found at: http://cl.no.irs.gov/la/BranchC/Index.htm by clicking on "Guide to Legislative Proposals." Be sure to include the name and telephone number of the SB/SE business unit’s point of contact for the proposal.

    2. A GTL analyst reviews and assigns legislative proposals received during the quarterly process. The analyst may contact the originator for additional information if the proposal needs clarification.

    3. The GTL analyst enters quarterly proposals received on the SB/SE Legislation Proposal Tracking spreadsheet. GTL tracks and updates the proposals throughout the development process.

    4. GTL forwards the proposals to SB/SE Division Counsel for review. SB/SE Chief Counsel reviews the proposals to determine if other BODs have ownership of the code sections that the proposals address and determines whether the proposals are feasible and warrant further consideration.

    5. GTL forwards the proposals that are deemed by SB/SE Chief Counsel to warrant further consideration in a two paragraph summary format to the SB/SE Commissioner. GTL notifies the originators of proposals that do not warrant further consideration, and further development is suspended.

    6. The SB/SE Commissioner prioritizes proposals based on their support of the IRS Strategic Plan and their impact on the tax gap. Proposals approved by the SB/SE Commissioner are sent back to GTL for further development.

    7. GTL coordinates the development of approved legislative proposals through meetings with the originator, SB/SE Chief Counsel, Disclosure and other impacted BODs. These meetings allow for an interchange of ideas and suggestions in an effort to fully develop a proposal.

    8. SB/SE business units may be requested to establish cost estimates for a proposal. To determine cost estimates for a proposal, consideration should be given to the impact, cost/benefit, revenue/volume, support of the Strategic Plan and impact on the tax gap. SB/SE business units should utilize resources such as MITS, BSP, Research, and Strategic Planning in developing cost estimates.

    9. GTL forwards a proposal through the clearance process for approval after it has been fully developed. The legislative proposal clearance process is similar to the GAO/TIGTA clearance process, ( See IRM 11.53.4.6.9.) except for review by LA. LA reviews the proposal after the SB/SE Commissioner’s approval.

    10. The GTL analyst forwards the approved proposal to LA for review. LA forwards the proposal to Treasury for Congressional consideration.

    11. The Legislative Proposal Workflow Process flowchart provides a snapshot overview of the process and can be found at: http://sbse.web.irs.gov/CL2/psp/TGLI/WorkFlow/Legis/Proposal-WorkFlow.htm .


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