34.11.1 The SAUSA Program

Manual Transmittal

May 28, 2013


(1) This transmits revised CCDM 34.11.1, Special Assistant U.S. Attorney Program; The SAUSA Program.

Material Changes

(1) CCDM was added to provide new filing procedures in the U.S. Bankruptcy Court’s Case Management/Electronic Case Files (CM/ECF) electronic docket system for Counsel attorneys participating in the SAUSA program.

(2) In CCDM, titles and hyperlinks were added to CCDM and IRM references, and organizational titles were updated.

Effect on Other Documents

CCDM 34.11.1, dated August 11, 2004, is superseded. This revision incorporates Chief Counsel Notice CC-2004-008, dated December 16, 2003.


Chief Counsel

Effective Date


Kathryn A. Zuba
Deputy Associate Chief Counsel
(Procedure & Administration)

General Information Regarding the SAUSA Program

  1. Purpose. The purpose of this subsection is to provide general operating procedures governing the Special Assistant U.S. Attorney (SAUSA) Program.

  2. Scope. This subsection applies to all Chief Counsel attorneys participating in the SAUSA Program.

  3. Background. In cooperation with the Tax Division and with the agreement of participating U.S. Attorneys’ offices, a program has been implemented in participating Chief Counsel field offices known as the SAUSA program. Through this program certain Chief Counsel attorneys are designated as Special Assistant U.S. Attorneys (SAUSAs) to handle, on behalf of the U.S. Attorney, all (or certain designated) bankruptcy matters involving the Service. These cases may include cases referred to the Tax Division but reassigned by the Tax Division to the U.S. Attorney or reassigned by the Tax Division to the SAUSA.

  4. Unless otherwise agreed to by the local Chief Counsel SB/SE office and U.S. Attorney's office, a SAUSA will not handle cases arising in a bankruptcy court located more than fifty miles from the local SB/SE office where the SAUSA is employed. Further, unless otherwise agreed, a SAUSA will not practice in a jurisdiction outside of the state where his local SB/SE office is located.

  5. A SAUSA will prepare and file pleadings, motions, briefs, memoranda, notices of appeal and other relevant documents; appear, on behalf of, and represent the Service in bankruptcy court and undertake all other work necessary to effectively handle the cases assigned.

Relationship with the Tax Division

  1. The Appointment Process. To have a Chief Counsel attorney appointed as a SAUSA, the attorney’s local SB/SE manager must first forward a letter of recommendation to the local U.S. Attorney recommending the appointment. If the U.S. Attorney concurs with such appointment, he will provide the necessary application materials for execution by the designated attorney. To effectuate the appointment, the U.S. Attorney will execute an Appointment Affidavit designating the attorney as a SAUSA for a specific period of time. Following the initial appointment, the U.S. Attorney periodically may re-issue a letter extending the SAUSA appointment for additional terms ranging from one to two years.

  2. Guidance. The Tax Division will provide necessary manuals, standard pleadings, and consultation as to positions and procedures. The respective U.S. Attorney’s office will provide instruction and assistance on local rules, procedures, and whatever other assistance would be helpful.

  3. Supervision. The SAUSA will be supervised by their local SB/SE manager in conjunction with either the U.S. Attorney or the Tax Division depending on which office has responsibility for the case. See CCDM, Referral to the Department of Justice in Bankruptcy Code Cases. The procedures followed by Assistant U.S. Attorneys for coordinating legal positions, briefs, pleadings, and other issues with the Tax Division apply to a SAUSA. The Tax Division should be provided with copies of all documents filed by SAUSAs addressing novel or unsettled areas of the law, issues having broad implications or issues requiring review by the Associate Chief Counsel (Procedure & Administration). To the extent that time permits, copies of such documents should be provided to the Tax Division prior to being filed.

  4. 28 U.S.C. § 530B Requirement. Under 28 U.S.C. § 530B, an attorney for the Department of Justice is subject to Federal, State and local laws and rules, including court rules, where such attorney practices to the same extent and in the same manner as any other non-government attorney in that State. Like other DOJ attorneys, a SAUSA must follow the rules and standards established by DOJ to comply with this provision. SAUSAs should contact their respective U.S. Attorney offices for guidance and answers to questions on section 530B.

  5. Referral Letter. To assure that the Tax Division is properly authorized to act in these cases, referral letters will be prepared in all cases handled by Chief Counsel attorneys in their capacity as SAUSAs referencing their representation on behalf of the IRS. To the greatest extent possible, however, short form letters should be used. In this regard, use of attachments (such as an underlying Insolvency Unit Memorandum) is encouraged. See CCDM, Referral to the Department of Justice in Bankruptcy Code Cases. Further, the local U.S. Attorney should be notified regarding the opening and closing of any SAUSA cases.

  6. Settlement Memoranda and Decisions of the Bankruptcy Court.

    1. Settlement. In cases requiring coordination with the Tax Division, immediately after a settlement offer is received, the SAUSA will submit to the Tax Division a memorandum stating the SAUSA’s recommendation as to acceptance or rejection of the offer.

    2. Adverse Decision. In view of the extremely short period for filing a notice of appeal, the SAUSA will contact by telephone the Chief of the respective Civil Trial section of the Tax Division immediately after receipt of an adverse bankruptcy court decision to provide the SAUSA’s recommendations concerning appeal and to obtain the Chief’s determination as to whether an appeal is to be filed and who is to file it. If the Chief decides that the SAUSA is to file the appeal, the SAUSA will immediately prepare and file a notice of appeal. If for any reason the SAUSA is unable to obtain a timely determination by the Chief, the SAUSA is responsible for timely filing a protective notice of appeal. As soon as possible after filing a notice of appeal, the SAUSA will refer the case to the Tax Division by memorandum stating the SAUSA's views as to appeal. See CCDM, Referral to the Department of Justice in Bankruptcy Code Cases.

    3. Appeal by Opposing Party. Immediately after receiving notification that an opposing party has appealed a bankruptcy court decision favorable to the Service, the SAUSA will transfer the case by memorandum to the Tax Division.

  7. Cases That May Be Handled By a SAUSA. The following types of issues may be handled by a SAUSA without specific authorization from Tax Division:

    • Complaint to sell property

    • Cash collateral hearing

    • Conversion from Chapter 11 or 13 to Chapter 7, or dismissal of Chapter 11 or 13 case

    • Motion to compel distribution and accounting

    • Motion to pay tax or to stop pyramiding

    • Motion for a More Particularized Disclosure Statement

    • All motions to lift the stay

    • Objection to confirmation of a plan

    • Motion by the United States to vacate or modify the automatic stay where all

    • The other parties involved agree to the relief requested

    • Motion for order compelling production of records and/or filing of pre-petition tax returns

    • Motion for order compelling the filing of post-petition tax returns

    • Motion for order requiring segregation and/or deposit of post-petition trust

    • Fund taxes

    • Cases involving dischargeability (except those involving fraud, the Haas/Toti issue under Bankruptcy Code section 523(a)(1)(C), or novel issues)

    • Turnover hearings where the Government’s defense is limited to adequate protection

    • Objections to proofs of claims (except those involving: responsible person liability, the merits of the debtor’s tax liability, evidentiary hearings as to disputed matters, or important or novel issues)

    • Cases not specifically mentioned above after receiving express authorization from the Tax Division Section Chief to handle the specific matter

    • All cases involving issues not listed above will be referred to the Tax Division unless otherwise agreed. See CCDM, Referral to the Department of Justice in Bankruptcy Code Cases.

  8. Coordinating SAUSA Cases with the Office of the Associate Chief Counsel (Procedure & Administration). As in other non-SAUSA cases, a SAUSA must coordinate and submit for review certain issues arising in SAUSA cases with Procedure & Administration. See Exhibit 35.11.1-1 , Issues Requiring Associate Office Review, for guidance regarding bankruptcy issues that must be reviewed by Procedure & Administration.

Electronic Filing in Bankruptcy Courts

  1. Due to the Bankruptcy Courts’ transition to the Case Management/Electronic Case Files (CM/ECF) system, counsel attorneys, acting as Special Assistant U. S. Attorneys (SAUSA), can file documents directly with the courts over the Internet. The CM/ECF system uses standard computer hardware, a secure Internet connection and a browser, and accepts documents in Portable Document Format (PDF). The Public Access to Court Electronic Records (PACER) system permits electronic access to individual case docket sheets and filed documents.

  2. The CM/ECF docket is the court’s electronic docket; it is not a specific judge’s docket or chambers. In order to file a document with CM/ECF, the attorney must have a login and password. Each court determines to whom it will issue filing logins and passwords.

  3. IRC § 6103, which governs disclosure of returns and return information, does not prohibit the electronic transmission of tax information. IRC 6103(h)(4) authorizes disclosure of certain returns and return information in judicial tax administration proceedings with no condition on the manner of disclosure.

  4. The Internal Revenue Service, including the Office of Chief Counsel, prohibits email transmissions of sensitive but unclassified (SBU) information, which includes tax returns and return information, outside the IRS without an IT approved exception. See IRM, Secure Messaging & Encryption.

  5. The Service’s prohibition on transmission of returns and return information over the Internet is a result of security concerns, and is intended to prevent unlawful disclosures. The policy was not intended to contravene the explicit grant of authority by Congress to meet the needs of the federal judiciary system. Transmissions in accordance with court rules do not raise unacceptable security issues, as the judiciary’s safeguards parallel those used by the Service’s stakeholders who transmit tax returns electronically to the Service.

  6. When required by court rules, SAUSA attorneys may file documents electronically with the court’s CM/ECF electronic docket, provided that the submitting attorney has received the court’s login information and created a secure password.

  7. If local rules or court orders require that SAUSA attorneys email proposed orders to the judge, SAUSA attorneys may email proposed orders to the judge’s government email address, e.g., xxx.gov.

  8. To avoid the appearance of an ex parte communication when proposed post hearing orders are emailed to the judge, SAUSA attorneys should send the proposed order to opposing counsel or the unrepresented debtor/taxpayer by fax or overnight delivery service.

  9. SAUSA attorneys should consult the local court’s CM/ECF procedures regarding the process for filing exhibits, as well as guidance on exceptions to electronic filing, such as documents filed under seal or emergency motions.