It is important to know your opponent. The more you know about who you are up against, the better able you are to respond effectively.
This can certainly be applied to the IRS. In this two-part post, we will outline some of the different roles of IRS employees and how those affect taxpayers. In part two, we will extend this discussion to the process for initiating a criminal investigation.
Despite budget cuts in recent years, the IRS still has tens of thousands of employees. But those employees are hardly an undifferentiated mass. They fall into several roles and areas of responsibility.
Let's consider these roles and responsibilities in the context of a tax audit. Once a return is submitted, the IRS uses software to check for possible discrepancies. If indicates discrepancy warrants closer scrutiny, a return is reviewed by an auditor. The auditor may decide that the return is in compliance with tax law. But it is also possible that the auditor will recommend further examination.
At that stage, the file is assigned to a group, where a manager reviews the file and can either accept the return or assign it to another auditor for another review. Upon receiving this assignment, the auditor can also either conclude that it should be accepted without revision. But it is also possible that this individual auditor will seek more information from the taxpayer to clarify any questionable items.
Many audits are conducted by mail. Others are done in-person at an IRS office or a taxpayer's place of business. No matter which type of audit it is, an experienced tax attorney can provide valuable guidance and counsel.
If the IRS eventually asserts that you have tax debt, a different category of employee would be involved in trying to collect that debt. Those employees are revenue officers.
In part two of this post, we will discuss yet another category of employee: special agents who conduct criminal investigations.