5.1.22  Disclosure

Manual Transmittal

October 23, 2014

Purpose

(1) This transmits a revised IRM 5.1.22, Field Collecting Procedures, Disclosure.

Material Changes

(1) IRM 5.1.22.7(3)a is updated to reflect the correct title and link to the Treasury Department Circular No. 230.

Effect on Other Documents

This IRM supersedes IRM 5.1.22 dated December 6, 2011.

Audience

The target audience is revenue officers in SB/SE Field Collection.

Effective Date

(10-23-2014)

Rocco A. Steco
Acting Director, Collection Policy
Small Business/Self Employed
SE:S:ECS:CP

5.1.22.1  (10-21-2011)
Overview — Disclosure

  1. This IRM provides disclosure procedures specifically for revenue officers due to the complex nature of collection cases.

  2. Follow these procedures when you are working collection cases to prevent unauthorized disclosures. The Taxpayer Browsing Protection Act, enacted August 1997, provides that the willful unauthorized access or inspection of any taxpayer records, including hard copies of returns, return information, and taxpayer information maintained on a computer, is a crime. See IRM 5.1.3.7.5, Taxpayer Browsing Protection Act .

  3. Disclosure is defined in the Internal Revenue Code (IRC) as the making known to any person, in any manner whatever, a return or return information. See IRC § 6103, Confidentiality and disclosure of returns and return information.

  4. Service policy permits disclosure only by personnel so authorized under the most current revision of Delegation Order 11-2, Authority to Permit Disclosure of Tax Information and to Permit Testimony or the Production of Documents.

  5. This IRM includes information on the following:

    • Disclosure of Criteria for Examination Selection

    • Disclosure of Joint Returns — Divorced or Separated Spouses

    • Disclosure of Trust Fund Recovery Penalty Payment Information

    • Disclosure Regarding Informant Claims

    • Disclosure of Case Files

    • Oral Disclosure

  6. Elevate any questions or concerns regarding these IRM procedures through your group manager (GM). GMs will direct any questions or concerns to the appropriate Area contact for possible referral to Headquarters.

5.1.22.1.1  (12-06-2011)
Resources from the Office of Disclosure

  1. The Office of Disclosure helps all IRS employees protect confidential tax and other sensitive information.

  2. Contact the Disclosure Help Desk at 866-591-0860 or by email at *SBSE Office of Disclosure if you need assistance when questions arise concerning disclosure.

  3. Refer to IRM 11.3, Disclosure of Official Information, specifically, IRM 11.3.2, Disclosure to Persons with a Material Interest, for additional guidance about disclosure.

  4. Access Disclosure References for Collection Employees on the Disclosure web page at: http://discl.web.irs.gov/Function/collection.asp for additional guidance and contact information.

5.1.22.2  (10-21-2011)
Disclosure of Criteria for Examination Selection

  1. It is the practice of the IRS to always respond to questions regarding the source of an audit. However, as Collection personnel do not routinely deal with the source of an audit, taxpayers who ask such questions need to be referred to the organization that performed the audit, e.g., Small Business/Self Employed Examination function or Specialty Programs, or Large Business and International (formerly Large and Mid Size Business).

  2. Refer the taxpayer to Publication 556, Examination of Returns, Appeal Rights, and Claims for Refund, or Publication 3498, The Examination Process.

5.1.22.3  (10-21-2011)
Disclosure of Joint Returns — Divorced or Separated Spouses

  1. IRC § 6103(e)(8), Disclosure of collection activities with respect to joint return, provides for disclosures pertaining to deficiencies assessed with respect to persons who have filed jointly but are no longer married or no longer reside in the same household.

  2. IRC § 6103(e)(8) clarifies that divorced or separated spouses may request information about the collection activities of their former spouse. IRC § 6103(e)(8), unlike IRC § 6103(e)(7), requires a written request for information. The same information may be requested verbally under IRC § 6103(e)(7).

  3. IRC § 6103(e)(8):

    1. Is relative to tax deficiencies with respect to a jointly filed return.

    2. Provides that certain limited information regarding one spouse shall, upon written request (from the taxpayer or authorized representative), be open to inspection by or disclosure to the other spouse.

    3. Does not apply to deficiencies that may not be collected by reason of IRC § 6502, Collection after assessment, (that is, due to the expiration of the statute for collection).

  4. The IRS has the authority to develop procedures controlling the frequency with which any requester can make requests pursuant to IRC §6103(e)(8). Governmental Liaison and Disclosure (GLD) has determined that only one request per six-month (calendar) period will be allowed. See paragraph (10) of IRM 11.3.2.4.1, Individuals.

5.1.22.3.1  (10-21-2011)
IRC § 6103(e)(8) Disclosure Procedures

  1. Follow the GLD procedures and only process one request from a requester per six-month (calendar) period pursuant to IRC § 6103(e)(8).

  2. See IRM 11.3, Disclosure of Official Information, for the general rules for disclosure of joint return information.

  3. Require the taxpayer or the taxpayer's authorized representative to submit a written request if the taxpayer desires information pursuant to IRC § 6103(e)(8).

  4. Provide a written response upon receipt of a written request from the taxpayer or the taxpayer's authorized representative for IRC § 6103(e)(8) information. The response may include the following:

    1. whether the Service has attempted to collect the deficiency from the other spouse,

    2. the amount, if any, collected from the other spouse,

    3. the current collection status (e.g., BAL DUE, installment agreement, suspended), and/or

    4. the reason for any suspension, if applicable (e.g., unable to locate, hardship).

    Exception:

    As noted above, the information provided under IRC § 6103(e)(8) may also be provided under IRC § 6103(e)(1)(B), subject to the provisions in IRC § 6103(e)(7), Return information, without a written request.

    Caution:

    Be aware of the information the requesting spouse is not entitled to under either IRC § 6103(e)(7) and IRC § 6103(e)(8).

  5. See IRM 5.1.22.3.1.1, Prohibited 6103(e)(8) Disclosures.

  6. Contact the Disclosure Help Desk at 866-591-0860 or by email at *SBSE Office of Disclosure if you need assistance when questions arise concerning the disclosure of divorced or separated spouses joint returns.

5.1.22.3.1.1  (10-21-2011)
Prohibited 6103(e)(8) Disclosures

  1. Do not disclose the following information regardless of whether a request is made under IRC § 6103(e)(7) or IRC § 6103(e)(8):

    1. the other spouse's location or telephone number,

    2. any information about the other spouse's employment, income, or assets, and/or

    3. the income level at which a suspended account will be reactivated.

5.1.22.3.2  (10-21-2011)
Other Joint Return Disclosure Procedures

  1. Contact the Disclosure Help Desk at 866-591-0860 or by email at *SBSE Office of Disclosure if you need assistance when questions arise concerning the disclosure of divorced or separated spouses joint returns.

  2. Refer requests for information concerning divorced or separated spouses beyond that provided for in IRC § 6103(e)(8) to the SBSE Office of Disclosure.

  3. Advise the taxpayer or the taxpayer’s representative to make a Freedom of Information Act (FOIA) request or a Privacy Act request if he/she desires further information. These requirements along with other information can be found at http://www.irs.gov/foia/index.html.

5.1.22.3.3  (10-21-2011)
Information Submitted by a Spouse

  1. Accept and process any information, as appropriate, received from one spouse regarding unexplored sources of collection from the other spouse.

  2. Do not inform the other spouse of the results, other than as discussed above.

5.1.22.4  (10-21-2011)
Disclosure of Trust Fund Recovery Penalty Payment Information

  1. IRC § 6103(e)(9), Disclosure of certain information where more than one person subject to penalty under section 6672, provides for disclosure to one person who has been assessed the trust fund recovery penalty (TFRP) pursuant to IRC 6672, certain limited information regarding other persons assessed the penalty for the same underlying tax. IRC 6103(e)(9) requires:

    1. Disclosure shall be made in written form upon receipt of a proper written request from a person who has been assessed the penalty or their duly authorized representative.

    2. Disclosure will be limited to the specific tax period associated with the requestor's TFRP.

5.1.22.4.1  (10-21-2011)
IRC § 6103(e)(9) Disclosure Procedures

  1. The Taxpayer Bill of Rights 2 provides the IRS with authority to establish procedures controlling the frequency with which any requester can make requests pursuant to IRC § 6103(e)(9). Until such procedures are developed at a national level, Service personnel should follow locally developed procedures. See paragraph (8) of IRM 11.3.2.4.13, Disclosure to Persons with a Material Interest, Trust Fund Recovery Penalties.

  2. Follow any locally developed procedures relative to controlling the frequency with which any requester can make requests pursuant to IRC § 6103(e)(9).

  3. Do not refer a TFRP disclosure to the SBSE Office of Disclosure when you can process it under IRC § 6103(e)(9) (i.e., the request meets IRC § 6103(e)(9) and the taxpayer is not making a Freedom of Information Act (FOIA) or a Privacy Act request).

  4. Refer to the following IRMs, as needed:

    • See IRM 11.3.40, Disclosures Involving Trust Fund Recovery Penalty Assessments, for the general rules for disclosure of TFRP information.

    • See IRM 5.7, Trust Fund Compliance.

5.1.22.4.2  (10-21-2011)
Guidelines for TFRP Disclosure

  1. Make an IRC § 6103(e)(9) disclosure:

    • in writing, and

    • only upon receipt of a proper written request from a person who has been assessed the penalty or their duly authorized representative.

  2. Limit any disclosure to the specific tax period(s) associated with the assessed requestor's TFRP.

    Reminder:

    Not all responsible officers receiving the penalty are assessed for the same periods.

  3. Follow these guidelines for determining whether you may make a disclosure pursuant to IRC § 6103(e)(9)

    Permissible TFRP Disclosures Prohibited TFRP Disclosures
    The name(s) of any other person(s) determined to be liable for the TFRP. The location or telephone number of the liable person(s).
    Whether the Service has attempted to collect the TFRP from any other liable person(s). Information about any individual whom the Service did not assess.
    The current collection status of any other liable person(s) (e.g., notice, BAL DUE, installment agreement, suspended, and if suspended, the reason). Any employment, income, or asset information about the liable person(s).
    The amount, if any, collected from each individual assessed the TFRP. The income level at which a currently not collectible account will be reactivated.
  4. Contact the Disclosure Help Desk at 866-591-0860 or by email at *SBSE Office of Disclosure for help when questions arise concerning the disclosure of TFRP information under IRC § 6103(e)(9).

  5. Advise the taxpayer or the taxpayer’s representative to make a FOIA request or a Privacy Act request if he/she desires further information.

5.1.22.4.3  (10-21-2011)
Information Submitted by a Liable Person

  1. Accept and process any information, as appropriate, received from one responsible party who reports he/she believes there are unexplored sources of collection from other parties.

  2. Do not inform the other liable parties of the results, other than as discussed above.

5.1.22.5  (10-21-2011)
Disclosure of Informant Claims

  1. An informant claim is a claim wherein the information that led to the development of the case was supplied by a whistleblower. A whistleblower is an individual who notices a significant Federal tax issue(s) in his/her workplace, while conducting day-to-day personal business, or anywhere else a tax issue(s) may be encountered, and reports the tax issue(s) to the IRS to help the IRS uncover tax cheating.

  2. The Service will not disclose the fact that a case is based on an informant claim, nor will the Service disclose the identity of the informant.

  3. See IRM 25.2, Information and Whistleblower Awards, for further information.

  4. Take the following actions when the taxpayer or the authorized representative asks for the source of the information that led to the issuance of the case.

    1. Do not disclose the identity of an informant under any circumstances.

    2. Inform the taxpayer you will have to get back to him/her with that information.

  5. Contact the Disclosure Help Desk at 866-591-0860 or by email at *SBSE Office of Disclosure immediately to determine how to respond to the taxpayer when a taxpayer (or the taxpayer's representative) requests the source of the case.

    Note:

    Disclosure will advise you of an appropriate response for you to provide.

  6. Respond to the taxpayer or the authorized representative only after consulting with Disclosure.

5.1.22.6  (10-21-2011)
Disclosure of Case Files

  1. A taxpayer or taxpayer representative has a right to information used to collect his/her tax liability, which includes a copy of the case file. The legal basis for giving taxpayers copies of their own tax records is contained in IRC § 6103(e). This section says the Service shall give taxpayers access to their returns upon written request. It also says the Service may provide copies of return information unless the Secretary determines release would seriously impair tax administration.

  2. IRC § 6103(e)(7) allows the IRS to withhold return information if that release would impair tax administration.

    1. If you are asked to provide copies of your case file, ensure the person requesting access has a legal right to the information.

    2. When you are satisfied they can have copies, review the information prior to release to determine that release of the information would not seriously impair tax administration.

  3. Impairment determinations should not be so narrowly construed to prevent the release of all information. Approval authority for determinations is delegated to the supervisory level personnel. If you have any concerns about whether to release something in the file, contact Disclosure for assistance.

  4. Questions to consider when making an impairment determination:

    1. Does the file contain any informant information? If so, do not release it.

    2. Is there any sensitive information that could reveal the nature, scope or direction of your investigation?

      Example:

      Notes regarding a plan of action to seize taxpayer assets or a possible fraud determination.

    3. Does the file contain third party tax information? If so, do not release it.

  5. Many taxpayers and representatives involved in a collection proceeding request copies of their IMF Specific or Complete transcripts. These records are not available through the Form 4506–T request process or the Transcript Delivery System (TDS). These records may be released, but take caution to carefully review the entity portion of the document. Watch for changes in marital status; for example, re-marriage, divorce, or separation. Further information can be found at http://discl.web.irs.gov/HotTopics/irc6103/3008.asp.

  6. Summoned documents and/or third party contact information is return information. Such information can be withheld if the Service determines that such release would:

    1. Jeopardize the collection of any tax,

    2. Involve reprisal against any person, or

    3. Jeopardize any pending criminal investigation.

  7. Every consideration should be given to releasing the records requested. If you determine that requested information cannot be released, make sure that determination is made so as to withhold only the narrowest range of information possible. The Freedom of Information Act (FOIA) or Privacy Act request process is available when a requester isn’t satisfied with a denial of access and no resolution can be reached with managerial involvement. Helpful information to aid the requester in submitting a formal FOIA request and other information about the FOIA process are available at http://www.irs.gov/foia/index.html.

5.1.22.7  (10-23-2014)
Oral Disclosure

  1. Treasury Regulation § 26 CFR 301.6103(c)-1(c) authorizes the IRS to accept non-written requests or consents authorizing the disclosure of return information to third parties assisting taxpayers in resolving Federal tax related matters. Such a request is an "Oral Disclosure Consent. "

    1. Only the taxpayer or his/her authorized representative (who has been previously given the authority by a Power of Attorney specifically to appoint other designees) can give an "Oral Disclosure Consent."

    2. An "Oral Disclosure Consent" may be taken from a taxpayer, or his/her authorized representative, who has open account issues or to whom some type of notice has been issued from IRS.

    3. The "Oral Disclosure Consent " expires when the account issue is closed.

    4. An "Oral Disclosure Consent" can only be made to a third party helping a taxpayer resolve a Federal tax matter.

  2. The "Oral Disclosure Consent" provision applies to an "Oral Disclosure Consent" received by:

    1. the Internal Revenue Service,

    2. an agent or contractor of the IRS, or

    3. a Federal government agency performing a Federal tax administration function in connection with a request for advice or assistance relating to such function.

  3. The "Oral Disclosure Consent" provision:

    1. Does not apply to disclosures to a taxpayer's representative in connection with practice before the Internal Revenue Service

      Note:

      Disclosures in connection with practice before the IRS are defined in Treasury Department Circular No. 230 (31 CFR Subtitle A, Part 10), Regulations Governing Practice before the Internal Revenue Service.

    2. Is significant for hearing impaired or non-English speaking taxpayers who may contact you through a relay operator or other third person.

  4. Do not make oral disclosure unless you receive an "Oral Disclosure Consent."

  5. Complete the same disclosure verification as if you were talking directly to the taxpayer.

  6. Limit the disclosure of return information to the information covered in the "Oral Disclosure Consent."

  7. Record an "Oral Disclosure Consent" as directed in IRM 21.1.3.3.2, Oral Disclosure Consent/Oral TIA (Paperless F8821).


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