13.9.1 Procedures for Taxpayer Advocate Directives

Manual Transmittal

October 08, 2020

Purpose

(1) This transmits new IRM 13.9.1, The National Taxpayer Advocate Office, Procedures for Taxpayer Advocate Directives.

Material Changes

(1) IRM 13.9.1, Program Scope and Objectives, added new section to incorporate internal controls per IRM 1.11.2.2.5, Internal Management Document System.

(2) This transmittal moves TAD procedures to a new IRM chapter governing the National Taxpayer Advocate’s office, expands and updates them to make them more consistent with current TAD practices, and to incorporate Section 1301(a) of the Taxpayer First Act (P.L. 116-25), which was enacted on July 1, 2019. This legislation codified the TAD appeal process.

(3) Taxpayer Advocate Directive (TAD) procedures previously appeared at IRM 13.2.1.6, a chapter of the IRM governing Systemic Advocacy Issues.

(4) IRM 13.2.1.6.1, 13.2.1.6.1.1, and 13.2.1.6.1.2 move to IRM 13.9.1.2. Expanded the Pre-TAD Process and renamed section for clarity.

(5) IRM 13.2.1.6.1.3, Issuing TADs move to 13.9.1.3. Expanded and clarified the process.

(6) IRM 13.2.1.6.2 move to 13.9.1.4. Expanded and clarified the process.

(7) Editorial, formatting, grammar, and clarification changes were made throughout this document.

Effect on Other Documents

IRM 13.2.1.6, Taxpayer Advocate Directives, dated 07-16-2009 is obsolete as of the IRM effective date.

Audience

Primarily Taxpayer Advocate Service and all Operating Divisions and Functions

Effective Date

(10-08-2020)

Erin M. Collins
National Taxpayer Advocate

Program Scope and Objectives

  1. Purpose: This section contains procedures relating to Taxpayer Advocate Directives (TADs).

  2. Audience: The primary users of this IRM are the National Taxpayer Advocate (NTA), the heads of all IRS Operating Divisions (ODs) or functions, the IRS Deputy Commissioners, the Commissioner of Internal Revenue, and the staff of these senior leaders.

  3. Policy Owner: The NTA owns the policies contained herein.

  4. Program Owner: The NTA administers the TAD process.

  5. Primary Stakeholders: All IRS employees are stakeholders in the TAD process.

Background

  1. Pursuant to Delegation Order (DO) 250, effective March 17, 1998, IRS Commissioner Rossotti delegated the authority to issue TADs to the NTA.

  2. DO 250 explained that a TAD enables the NTA to direct improvements to IRS operations or to grant relief to groups of taxpayers (or all taxpayers) in much the same way that the NTA may use a Taxpayer Assistance Order (under IRC § 7811) to order relief for individual taxpayers.

  3. According to a "note to reviewers," DO 250 was revised by IRS Commissioner Rossotti on January 17, 2001, to remove the procedures for issuing TADs from the DO because "[t]hese procedures are more appropriately set forth in documents such as the Internal Revenue Manual."

  4. DO 250 (Rev. 1) was subsequently renumbered as DO 13-3 and the authority to modify or rescind a TAD was given to both the Deputy Commissioner for Services and Enforcement, and the Deputy Commissioner for Operations Support.

  5. Section 1301(a) of the Taxpayer First Act (P.L. 116-25), which was enacted on July 1, 2019, establishes a TAD appeal process. It also requires the NTA to identify in her Annual Report to Congress any TAD which was not honored in a timely manner.

Authority

  1. DO 13-3 (IRM 1.2.2.12.3, Delegation Order 13-3 (formerly DO-250, Rev. 1) Authority to Issue Taxpayer Advocate Directives) grants the NTA authority to issue TADs. It states that the NTA may issue a TAD to: "mandate administrative or procedural changes to improve the operation of a functional process or to grant relief to groups of taxpayers (or all taxpayers) when implementation will protect the rights of taxpayers, prevent undue burden, ensure equitable treatment or provide an essential service to taxpayers." If agreed upon, IRC § 7803(c)(5)(A) provides that the IRS Commissioner or a Deputy Commissioner shall ensure compliance with such directive not later than 90 days after its issuance.

  2. The DO also grants authority to modify or rescind a TAD to the NTA and the Deputy Commissioners. The authority to issue, modify, or rescind a TAD may not be redelegated.

  3. IRC § 7803(c)(5)(B) grants the NTA the authority to appeal a TAD to the IRS Commissioner.

Program Management and Review

  1. The NTA will summarize TAD activity in the Annual Report to Congress that is required by IRC § 7803(c)(2)(B)(ii) and may include copies of TADs in these reports (redacted, if necessary).

  2. The NTA will identify in the Annual Report to Congress, any TADs not honored by the IRS in a timely manner, as required by IRC § 7803(c)(2)(B)(ii)(VIII).

  3. TAS may post the redacted TADs, TAD appeals, and the IRS’s formal response to TADs on the TAS website. Redactions of TADs, TAD appeals, and IRS formal responses will be performed by the office of the Associate Chief Counsel, Procedure and Administration, or the Privacy, Government Liaison and Disclosure office.

Terms

  1. The following table contains terms that are used throughout this IRM.

    Term Definition
    Deputy Commissioner The term Deputy Commissioner refers to the Deputy Commissioner for Services and Enforcement, the Deputy Commissioner for Operations Support, and any successor(s) to these positions.
    Proposed Taxpayer Advocate Directive (TAD) A proposed TAD is a written communication from the NTA that recommends action (or forbearance of action) to address a systemic problem that affects multiple taxpayers, which TAS has brought to the attention of the responsible head of office.
    TAD A TAD is a tool that the National Taxpayer Advocate (NTA) may use to elevate systemic issues that affect multiple taxpayers to ensure that IRS senior leadership is fully informed of urgent and significant issues and the NTA’s recommendations to address those issues.

Acronyms

  1. The following table contains acronyms that are used throughout this IRM.

    Acronym Definition
    DO Delegation Order
    IRC Internal Revenue Code
    IRM Internal Revenue Manual
    IRS Internal Revenue Service
    NTA National Taxpayer Advocate
    OD Operating Division
    P.L. Public Law
    TAD Taxpayer Advocate Directive

The Pre-TAD Process

  1. While the TAD process itself provides responsible IRS officials an opportunity to address the NTA’s concerns, the communications that precede a TAD provide additional opportunities for the OD or function to address the concerns and work with the NTA to resolve issues.

    1. Before issuing a proposed TAD, TAS generally attempts to work with the process owner(s) to implement change. See IRM 13.2, Systemic Advocacy (discussing informal communications and advocacy proposals).

    2. Before the NTA issues a TAD, TAS normally communicates the NTA’s concerns to the responsible OD or function using a proposed TAD. A proposed TAD can be in the form of a memorandum or an email communication from the NTA to a head of office. It includes or references one or more actions to address a problem with an IRS operation of a functional process affecting a group of taxpayers (or all taxpayers).

  2. A Most Serious Problem in an Annual Report to Congress is not a proposed TAD.

  3. A proposed TAD may specify a period of no less than fifteen (15) days to respond. If no period is specified, the recipient will have ninety (90) days to respond. Only the NTA may grant an extension of the period to respond. The NTA will grant reasonable requests to extend the period to respond.

    1. If the responsible OD or function does not agree to take the proposed action(s) to address the problem, it will provide a written explanation of the reasons. The response can be in the form of a memorandum or email communication from the head of office to the NTA. It may include a counterproposal for addressing the problem.

    2. The NTA may agree with the OD or function that no action is warranted, accept an alternative suggestion, or accept a proposal by the OD or function to work with TAS on a solution. The NTA will inform the OD or function within sixty (60) days whether she will agree or if she plans to pursue a TAD or other avenue to address the concern.

    3. There is no appeal of a proposed TAD.

  4. The NTA will provide a copy of any proposed TAD to the applicable Deputy Commissioner.

The TAD Process

  1. The NTA may issue a TAD to the appropriate Deputy Commissioner if the head of the responsible OD or function does not timely respond to a proposed TAD, or if the response does not fully address the NTA’s concerns. The NTA will provide a copy of any TAD (and any modification to a TAD) to the IRS Commissioner so that he may timely fulfill his duties under IRC § 7803(c)(5). The NTA will also provide a copy of the TAD to the head of the responsible OD or function.

  2. Although a proposed TAD is generally issued before a TAD, if the NTA determines that the problem is immediate in nature and a delay in addressing it would have a significant negative impact on taxpayers, she may issue a TAD without first issuing a proposed TAD.

  3. While a TAD is pending, the OD or function is not required to take the action(s) specified in the TAD. It may continue normal operations, however, it will not take any action that would make it impossible for the IRS Commissioner or a Deputy Commissioner to ensure that the OD or function complies with the TAD within the 90 day period(s) provided by IRC § 7803(c)(5). If an assessment or collection statute of limitation is set to expire, the IRS is not prohibited from protecting the statute while the appeal of a TAD is under consideration.

  4. The Deputy Commissioner will modify, rescind, or ensure compliance with the TAD by the response date - a date not earlier than 45 days and not later than 90 days after its issuance. The NTA will grant reasonable requests to extend the period to respond, not to exceed the 90-day period provided in IRC §7803(c)(5)(A). If the Deputy Commissioner modifies or rescinds the TAD, she or he will provide the NTA with a written explanation of the reasons.

Examples of When TADS May Be Issued and to Whom

  1. TAD following a Proposed TAD. The NTA issues a proposed TAD in the form of an email communication to the head of an OD or function, which proposes systemic changes to address a problem. The email has "Proposed TAD" in the subject line. The NTA provides a copy to the Deputy Commissioner. The responsible OD or function enters into negotiations with TAS to address the concerns. If those negotiations are not progressing as expected, the NTA may issue a TAD.

  2. TAD without a Proposed TAD. The NTA learns that an OD plans to cut essential services to taxpayers during the filing season, which is five months away. The NTA proposes a way to change procedures that would allow the IRS to avoid these cuts. Normal procedures for resolving TADs may take more than five months. Because the problem is immediate in nature and will have a significant negative impact on taxpayers, the NTA may issue a TAD without first issuing a proposed TAD.

The Content of a TAD

  1. A TAD is written as a memo from the NTA to a Deputy Commissioner.

  2. For ease of reference, each TAD includes a document number in the subject line. For example, the first TAD issued by the NTA in calendar year 2021 would be numbered as "TAD 2021-1" and the second would be numbered "TAD 2021-2." In some cases, explanatory materials will be included as attachments, rather than in the body of the TAD.

  3. A TAD normally includes the following:

    1. Specific action(s) that the NTA directs.

    2. Discussion of the reasons for the NTA’s directive(s).

    3. Efforts by TAS to work with the OD or function to resolve the issue (e.g., by discussing the issue at meetings and issuing a proposed TAD), and any response (or lack of response) received from the OD or function.

    4. Why the response (or lack of response) by the OD or function does not fully address the concern.

    5. If the NTA has determined to forego a proposed TAD, the reasons for doing so.

    6. The date by which a response is required (no less than forty-five (45) days from the issuance of the TAD, called the response period).

    7. A date by which the directed action (action date) is to be completed (no sooner than the date by which a response is required in IRM 13.9.1.3.2(3)(f)).

The TAD Appeal Process

  1. In the case of any TAD which is modified or rescinded by a Deputy Commissioner, the NTA may appeal the modification or rescission to the IRS Commissioner. The NTA will appeal within the same number of days as the response period (described in IRM 13.9.1.3.2 (3)(f)). The Deputy Commissioner will grant reasonable requests to extend the period to appeal, not to exceed the 90-day period provided in IRC § 7803(c)(5)(B).

    Note:

    If the NTA does not respond to the Deputy Commissioner’s modification or rescission within the period described in IRM 13.9.1.4 (1), the Deputy Commissioner’s decision is final.

  2. The IRS Commissioner will, not later than ninety (90) days after the NTA appeals the modification or rescission of a TAD by the Deputy Commissioner, either:

    1. Ensure compliance with the TAD as issued by the NTA or modified by the Deputy Commissioner, or

    2. Provide the NTA with the reasons in writing for any modification or rescission made or upheld by the IRS Commissioner, as required by IRC § 7803(c)(5)(B).