The Joint Committee Review (JCR) program of the Internal Revenue Service (IRS) oversees the preparation of Joint Committee reports for all agreed, partially agreed, no-change and surveyed cases for IRC 6405 refunds of income, estate and gift taxes, and certain excise taxes in excess of the current statutory threshold of $2 million ($5 million for C corporations) regardless of the business operating division. JCR is part of the Large Business and International business operating division (LB&I).

A refund or credit subject to Joint Committee review can arise from an examination, an unpaid claim, or tentative allowances in excess of the jurisdictional amount. The examiner is responsible for determining whether a case falls under Joint Committee jurisdiction. The fact that a return or examination must be reported to Joint Committee on Taxation (JCT) does not alter the nature of the examination that may be conducted, nor does it limit the examiner’s ability to survey the return if this is the action deemed appropriate.

A Joint Committee Specialist (JCS) reviews the case files for procedural, computational and technical accuracy and prepares the report that is submitted to the JCT refund staff for review. Once the JCT issues a clearance letter or closes an open Staff Review Memorandum (SRM), the case is processed for closure and the JC refund is released.

Concerns over the potential for corruption and favoritism prompted the enactment of IRC 6405. IRC 6405 provides the JCT with oversight (as opposed to approval) authority of refunds of income, estate and gift taxes, and certain excise taxes in excess of a statutorily prescribed amount. It is to these refund cases that these procedures apply.

House of Representative’s bill (H.R. 5771) was signed by the President and became law effective December 19, 2014 to increase the JC threshold for C corporations. The jurisdictional amount for C corporations is in excess of $5 million and for all other taxpayers the jurisdictional amount is in excess of $2 million.

The Joint Committee on Taxation (JCT) is a nonpartisan committee of the United States Congress, established under the Revenue Act of 1986 (originally established under the Revenue Act of 1926). JCT formally consists of ten Members of Congress: five from the Senate Committee on Finance; and five Members from the House Committee on Ways and Means. The JCT is responsible to provide oversight authority over refunds of income, estate and gift taxes, and certain excise taxes. The JCT’s duties are set forth in IRC 8022 which include consideration of possible changes in the tax laws leading to their clarification, simplification or revision to prevent undue hardships or the granting of unintended benefits.

The Joint Committee Review (JCR) program is part of the IRS and not a part of JCT. The Large Business and International (LB&I) Division of IRS provides the support function for the JCR program to LB&I, SB/SE and TE/GE. JCR oversees the preparation of Joint Committee reports for all agreed, partially agreed, no-change and surveyed cases for IRC 6405 refunds of income, estate and gift taxes, and certain excise taxes in excess of the statutory threshold.

JCR includes specialists located in various posts of duty around the country. Staffing of the program will vary depending on case workload.

The JCT staff attorneys (also known as Refund Counsel) will review the Joint Committee report and other documentation as deemed necessary. Should the staff attorney have questions, they are usually resolved informally through phone calls or e-mails to the JCR. In some instances, a written inquiry may be issued. When JCR is notified that the staff attorney has no further questions or concerns, the case can be processed. In the event the JCT disagrees with or questions the position taken in the report, the case is, generally, as a matter of agency policy, not processed pending the resolution of the dispute. JCT will issue either a clearance letter or SRM upon completion of their review.

Monthly reports are prepared and reconciled to the ARC 27 report and the AIMS Status 26 report. These reports are submitted to the NECPA Program Manager for review and distribution.

See Exhibit 4.36.1-1 for a list of commonly used acronyms.

Joint Committee topics may be found on the IRS Knowledge Management website at:Joint Committee Virtual Library. This site contains a wealth of information about all the various aspects of a Joint Committee case, including frequently asked questions, job aids, contact information, and JC forms. It is a place to visit for valuable tools and resources.