The Freedom of Information Act (FOIA) established an effective legal right of access to government information by requiring agencies to make various information available to the public. Taxpayers who file FOIA requests can administratively appeal to the Commissioner when the Internal Revenue Service (IRS) Disclosure Offices deny requests or when the IRS does not respond timely and asks for an extension of time to process the requests. Taxpayers who do not agree to voluntarily extend the time frame can consider the delay a denial of their request for information and, therefore, may appeal.

The Assistant Chief Counsel (Disclosure Litigation) in the IRS Office of the Chief Counsel was responsible for processing the administrative appeals; this Office closed almost 1,700 appeals cases in Fiscal Year 1999. The IRS’ Modernization Plan transfers responsibility for reviewing appeals to the Chief, Appeals because it more appropriately falls within that Office’s jurisdiction.

The objective of the audit was to evaluate the IRS’ efforts to provide prompt and appropriate service to taxpayers who appeal a denial of a FOIA request for information or a delay in providing information.

The Assistant Chief Counsel (Disclosure Litigation) staff made appropriate determinations in the 50 cases we sampled. Attorneys and paralegals generally worked cases when taxpayers appealed because the IRS denied their requests for information. Attorneys and paralegals properly determined whether the IRS’ decisions to not provide information were appropriate. Clerical employees generally worked cases timely and appropriately when taxpayers appealed because of IRS delays in providing information.

Although the IRS correctly processed taxpayers’ appeals, improvements to the service can be made by:

• Responding timely when taxpayers appeal because the IRS denied their requests for information.
• Analyzing FOIA appeals case information to identify potential trends in resource or case resolution issues in Disclosure Offices.

At the end of Calendar Year 1999, the Office of the Chief Counsel inventory records indicated that 918 appeals had been open an average of 420 workdays. These appeals had been filed by taxpayers when the IRS denied their requests for information. The 420 workdays extend significantly beyond the 20 workday requirement in the law. These cases were assigned, based on complexity, to attorneys or to paralegals to make determinations as to the appropriateness of the IRS’ initial denial of the requests.

Although the Office of the Chief Counsel records indicated that, on average, attorneys expended 19 hours and paralegals expended 6 hours working an appeal, the appeals were often in inventory several months and sometimes for years before decisions were made and provided to the taxpayers. Management from the Assistant Chief Counsel (Disclosure Litigation) cited two main reasons for these extensive time frames: the loss of paralegal staff who principally handled FOIA appeals, and the subsequent distribution of appeals to attorneys who had higher priority work.

The Chief, Appeals has been implementing its Modernization Plan, including the transfer of responsibility for FOIA appeals. That Office, however, has not set a specific target date for transferring the FOIA appeals responsibilities or conducted an analysis to determine the staffing necessary to timely process the appeals.

FOIA appeals information was not analyzed to identify trends that Disclosure Offices could address. For example, data may indicate an inordinate number of appeals due to delays in a few Disclosure Offices or common characteristics among cases decided in favor of taxpayers. Identifying these characteristics and resolving any associated problems could reduce the need for taxpayers to appeal.

The Office of the Chief Counsel should work with the Chief, Appeals to expedite the transfer of responsibility for resolution of FOIA appeals. The Chief, Appeals should determine the staffing necessary to timely process FOIA appeals and should capture case information and periodically trend FOIA appeals data.

Management’s Response: IRS management agrees that expediting the transfer of responsibility for processing FOIA appeals and ensuring an appropriate level of staffing necessary to process FOIA appeals quickly are critical steps towards the IRS’ renewed commitment to the FOIA. The Chief, Appeals is considering staffing needs required to process FOIA appeals more quickly and effectively and will work with the Office of the Chief Counsel to ensure that workload transition issues and training needs are addressed.

Management’s response did not address specific corrective actions for the report recommendation to periodically trend FOIA appeals data. As a result, we could not determine whether adequate corrective action was planned to capture case information and periodically trend the data. As part of our follow-up activities, we are asking management to provide us more specific information on its planned corrective action. Management’s complete response to a draft of this report is included as Appendix IV.