- 1.54.1.1 Responsibilities of Management for Casework
- 1.54.1.2 Elevating Issues
- 1.54.1.3 Why issues are elevated
- 1.54.1.4 Issues that are Candidates for Elevation
- 1.54.1.5 Level to which Issues should be Elevated
- 1.54.1.6 Determining the Level to which Issues should be Elevated
- 1.54.1.7 Referral to or Consultation with Counsel
- 1.54.1.8 Issues Reported or Resolved Outside the Internal Revenue Service
- 1.54.1.9 Avoiding Inappropriate Elevation by Appropriately Exercising Responsibility
- 1.54.1.10 Reaching Down
- 1.54.1.11 Consulting with front-line employees and managers
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The Tax Exempt and Government Entities (TE/GE) Division’s new structure creates new patterns for reporting information and for making decisions. A key feature of the reorganization of the IRS, and of the transformation of Employee Plans/Exempt Organizations (EP/EO) into TE/GE, is the restructuring of lines of authority.
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Previously, EP/EO employees and managers who worked outside of the National Office reported to local District Directors, rather than to the Assistant Commissioner (EP/EO). Under this arrangement, the Assistant Commissioner (EP/EO) did not have direct authority over the work performed by most EP/EO employees, nor did the Directors of the Employee Plans or Exempt Organizations Divisions.
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Now that has changed. All TE/GE employees, wherever they are physically located, report through a chain of command that begins with immediate supervisors, includes Area Managers, or their equivalent, and National Directors, and goes ultimately to the Commissioner, TE/GE. Stated another way, everyone within TE/GE is part of a single, unified organization, and the lines of authority within it run from the Commissioner, TE/GE downward to every individual.
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There are two consequences of this reorganization that are of immediate and practical concern for every TE/GE employee, manager and executive.
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In order for the organization to function well, certain types of information and certain decisions must be elevated from working levels of the organization to managerial and executive levels. Employees, managers and executives need to know what kinds of information and what decisions should be elevated, and to what level within TE/GE.
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The new structure means that it is now appropriate, and sometimes essential, for higher ranking managers and executives to involve themselves directly in the direction and decision of cases being worked or considered at a lower level. In some instances, managers and executives will involve themselves in cases to apply their experience and judgment at an early stage in the development of the case. In other instances, they will involve themselves as observers, in order to educate themselves about the manner in which work is performed in the field.
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Employees should understand that involvement in cases or issues by senior managers and executives is appropriate, is undertaken for good reasons, and does not suggest or imply criticism of how work is being performed at lower levels. Employees should also understand that such managerial or executive involvement is required for the sound management of a complex organization such as TE/GE, and does not reflect political influence, or other inappropriate meddling in cases.
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The first purpose of this section is to describe the circumstances when an employee of the Tax Exempt and Government Entities Division (TE/GE) should elevate an issue, that is, bring an issue which comes to his or her attention in the ordinary course of business to the attention of a higher-ranking manager or executive. In accomplishing this purpose, this section defines the following terms and concepts:
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Elevation,
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Issue,
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Why issues should be elevated, and
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The level within the organization to which different kinds of issues should be elevated.
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A second purpose of this section is to describe the circumstances when a higher ranking manager or executive of TE/GE may wish to inquire about an issue — especially a case — which is being worked or awaiting decision at a lower level within TE/GE.
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A third purpose of this section is to note that front-line employees and managers should be consulted when certain policies and procedures are developed.
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The word "elevation," as used in this section of the IRM, means to bring to the attention of higher level managers or executives an issue, concern or situation that those managers or executives must know about in order to execute the tax law faithfully and to manage TE/GE properly.
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To elevate an issue is to send it to higher-ranking TE/GE officials for their information or for their decision. One who elevates an issue recognizes that others within the organization need to know about the issue, or that he or she is not authorized, experienced, or knowledgeable enough to handle or decide the issues himself or herself.
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Elevation does not include a situation in which an employee, manager or executive merely refers an issue laterally within TE/GE or the Service, or undertakes to coordinate an issue with another part of TE/GE or the Service.
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A referral of a matter to Counsel is not necessarily an elevation, although it can be considered one if we transfer the power of decision over the issue to Counsel.
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The word "issue" , as used in this section of the IRM is not intended to have a precise or a restrictive meaning. In general, it means a matter that should not be decided or otherwise resolved in a routine, standard, or uniform manner. Often it involves a new, an unusual, or a sensitive matter. Ordinarily it is a matter that must be decided or resolved through the use of careful analysis, sound judgment, discretion and experience. For example, for purposes of this section, an issue could include the following:
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The interpretation or application of law or published guidance to a case;
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A non-standard case, including, e.g., unusual aspects of a determination letter application, or of an open or potential examination;
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Published guidance, including, e.g., regulations, revenue procedures, announcements and notices;
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A new administrative action or procedure, or a revision or an exception to an existing action or procedure, e.g., proposed amendments to a voluntary compliance program or a change in the way user fees are collected;
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The interpretation or application to a case of a new or existing administrative action or procedure;
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A developing or emerging issue, including issues that have not yet formally been presented to TE/GE by a taxpayer or that have not yet arisen in an examination, e.g., an issue we have learned of through discussions at a practitioner’s meeting, or at a meeting of a professional society;
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An allegation brought to TE/GE’s attention by an outside party, e.g., a report in a newspaper, or a letter from a member of the public, suggesting a possible violation of the Code.
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For purposes of this section, an issue does not include a matter incorporated in routine and regularly scheduled reports of ordinary events. In other words, this section of the IRM is not intended to supplement or replace guidance concerning the elevation of issues that are covered by well-established and well-defined reporting schemes. Employees, managers and executives already have instructions concerning the preparation and reporting of these matters.
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A variety of sound business reasons suggest that many issues arising at lower levels of the organization should be elevated to higher levels. Whenever one of these reasons is present with respect to an issue that you are responsible for or dealing with, you should consider elevating the issue to your immediate supervisor. In general, issues need to be elevated for one of two reasons:
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To inform managers and executives of things they need to know, and
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To present matters to them for decision.
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In considering whether to elevate an issue, there are two questions that are appropriate for an individual, at any level of TE/GE, to ask.
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"Am I technically capable, authorized, and comfortable about deciding this issue myself?" If the answer to any part of the question is no, or doubtful, you should elevate the issue to your immediate supervisor.
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"Is this issue something that my manager, or a higher-ranking manager or executive, would want to know about or should know about in order to perform his or her duties?" Another way of looking at the question is to put yourself in a manager or executive’s shoes, and ask if you would want to be aware of the issue if you were the manager or executive. If the answer to any of these questions is yes, you should elevate the issue to your immediate supervisor.
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In case of doubt about whether to elevate an issue, the better practice is to elevate it. One to whom an issue is elevated may, in his or her discretion, decline the elevation and refer the matter back to the originating employee or manager for resolution.
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Reasons to elevate an issue for the purpose of informing managers or executives include, but are not limited to, the following:
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Inform managers and executives of issues that may eventually require action, approval, or a response, or that have the potential to become problems, but which will not come to managers’ and executives’ attention through an established reporting program. Examples of such issues include: sensitive issues, high-impact cases, matters which may generate publicity, or matters which have been handled inappropriately;
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Secure the cooperation of, or the coordination with, another part of TE/GE, another part of the IRS, or another government agency;
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Obtain the assistance or solicit the views of Counsel or Treasury;
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Obtain the assistance or solicit the views of the TE/GE Senior Technical Advisor;
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Obtain or promote the uniform application of the law, or the achievement of uniform results;
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Recommend improved administrative practices, or bring to light weaknesses in existing administrative practices;
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Notify managers and executives of deviations from established administrative practices, and the reasons for the deviations;
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Bring to light a sensitive or other important issue that is obscured by procedural or other issues.
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Reasons to elevate an issue for the purpose of obtaining a decision include, but are not limited to, the following:
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Present managers and executives with issues that require their action, approval or response;
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Comply with a statute, regulation, procedure, or directive that specifies the level at which a particular type of decision is to be made, e.g.: certain issues must be submitted for mandatory technical advice; requests for section 7805(b) relief must go to the Commissioner, TE/GE: closing agreements must go to the Commissioner, TE/GE or to the Director of EP, EO or GE; and field directives may require that certain cases be forwarded to specific places for decision;
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Obtain a decision when the issue is one of first impression, precedent setting sensitive, or otherwise of such significance that it should be decided at a higher level within the organization, e.g., a case in which a decision must be made between alternative interpretations of the law;
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Obtain a decision where the correct resolution of an issue is unclear or not well established;
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Offer senior managers or executives the opportunity to concur with or dissent from the proposed resolution of an issue when the proposed resolution is novel, sensitive, or precedent-setting;
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Obtain a decision where there is disagreement among employees, managers, or different organizations within TE/GE or the IRS as to how a technical issue should be resolved;
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Obtain a decision where there is disagreement among employees, managers or different organizations within TE/GE or the IRS as to how an administrative issue should be resolved;
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Obtain a decision where the organizational interests of different organizations within TE/GE or the IRS are in conflict, or where an impasse has been reached because of such conflict;
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Obtain personnel, IS, budgetary, or other resources.
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Closely related to the question of why issues should be elevated is the question of what issues should be elevated. It is not possible to present a definitive or exclusive list of all issues that should be elevated, because such a list changes in accordance with changes in the tax, business, or organizational environment, and with the context in which the issue arises. However, a representative list of issues that ordinarily would be candidates for elevation is presented below. Although the issues are presented as falling into one of two categories, many issues could be listed appropriately under both categories.
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To inform managers and executives:
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Issues that may eventually require action, approval, or response, or that have the potential to become problems, but which will not come to managers’ and executives’ attention through an established reporting program;
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Issues that are sensitive;
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Issues requiring coordination with other segments of TE/GE or the IRS;
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Issues requiring coordination with Counsel or with Treasury;
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Issues requiring coordination, or involving a policy dispute, with other Federal agencies;
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Issues that impact a large number of individuals;
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Issues with an extreme impact on one or more individual taxpayers, organizations, or entities;
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Issues involving substantial dollar amounts;
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Issues of concern to the EO, EP, or GE community;
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Issues of concern to Treasury, the Congress, or the tax-writing committees;
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Issues concerning the uniform application of the law, or the achievement of uniform results;
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Complaints from taxpayers about TE/GE policies, practices, employees, managers or executives;
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Situations in which TE/GE or the IRS has erred and correction is required;
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Situations in which administrative procedures could be improved or are not working as intended;
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Situations involving a deviation from an established administrative practice;
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Situations that are newsworthy, or that have the potential to become newsworthy;
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Situations involving a state, a municipality or an Indian tribal government;
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Inquiries or recommendations from the Government Accounting Office or the Treasury Inspector General for Tax Administration.
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To obtain a decision:
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Issues that require the action, approval or response of a manager or executive;
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Issues that are directed by statute, regulation, revenue procedure, or other directive or practice to a particular office or level for resolution or decision;
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Issues that are of first impression, precedent-setting, or sensitive, including departures from established positions or practices;
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Issues in which the correct resolution is unclear or not well established;
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Issues that are sensitive, but whose sensitivity is obscured by procedural or other issues;
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Situations in which there is disagreement among employees, managers, or different organizations within TE/GE or the Internal Revenue Service as to how a technical issue, or an administrative issue, should be resolved;
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Situations in which the organizational interests of different organizations within TE/GE or the IRS are in conflict, or where an impasse has been reached because of such conflict;
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Issues concerning personnel, IS, budgetary or other resources;
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Situations involving the revocation of a compliance statement or a closing agreement, or the amendment of a compliance statement.
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In most cases, employees should elevate issues to their immediate managers, who, in turn, should elevate them, as appropriate, to successively higher levels within the TE/GE chain of command. Generally, it is not necessary that each employee accurately gauge the ultimate level to which an issue should be elevated. If each employee, manager and executive understands his or her own area of responsibility and competence, takes action on issues that are within that area, and elevates to a higher level issues that are outside that area, issues will arrive for decision at the appropriate level.
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However, as noted above, under the new structure of TE/GE and the Service, it often will be appropriate for managers and executives at higher levels to inquire about or to involve themselves in matters being worked at a lower level. Further, taxpayers with matters pending before TE/GE regularly monitor the progress of their matter, and may become concerned if they find that their matter has been, or potentially may be, elevated above ordinary working levels.
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To provide a sense of comfort to both employees and to taxpayers as to the reasons a case with which they are involved has become the subject of higher level review, and to alleviate concerns that such a review reflects an adverse judgment by senior management on the work of the employee or on the merits of the taxpayer’s case, this section sets forth, in general terms, a description of the types of issues one may expect to be elevated to certain levels within TE/GE and the IRS.
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In general, the more significant an issue, the more likely it is to be elevated, and the higher it is likely to go up the chain of command. Further, as noted previously, some issues are directed automatically to certain levels within the Service, e.g., requests for 7805(b) relief must be approved by the Commissioner, TE/GE.
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The level to which an issue is elevated may be influenced by whether the issue is "local" or "national" in character.
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An issue of local concern is one which is of concern either to a single taxpayer, or to a group of taxpayers, generally located within the geographical boundaries of one area, or one which concerns a matter that is unique to or confined to the area in question.
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For example, taxpayer complaints about the staffing of EP posts of duty at certain hours, perceived errors in the way a particular employee is interpreting a section of the Code, or significant press reports of misuse of tax-exempt bonds by a particular municipality would be matters of local concern.
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Similarly, a conflict between TE/GE practice with respect to a tax-exempt organization and the requirements of a state attorney general’s office with jurisdiction over the same organization would be, at least initially, a matter of local concern.
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By contrast, an issue of national concern is an issue that affects similarly-situated taxpayers throughout the country, an issue that is precedent-setting or that will serve as a model for cases in other areas or throughout the country, or a non-routine issue that appears likely to present itself in several areas or throughout the country.
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For example, the appearance of a new kind of tax-qualified pension plan, such as the first cash balance plan, would, in most instances, present novel issues of national concern that should be elevated to the Director, Employee Plans Rulings and Agreements, and ultimately to the Director, Employee Plans. Such an issue might appear in a determination letter application, or an agent or manager might be asked a question about it, or hear a presentation on it, at a practitioners’ meeting or at a convention of a professional association.
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An issue of national concern may also be an issue that affects so prominent a taxpayer, or such a large group of individuals, that the attention of the tax community or of the public at large is drawn to the issue, so that the resolution of the issue effectively establishes a model for the country.
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With the foregoing in mind, the following is a description of issues that are to be decided at successively higher working, managerial, and executive levels within TE/GE.
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Employees are assigned work appropriate to their grade level and to their training. Ordinarily, employees work closely with their group managers and group managers are aware of issues arising in the course of an employee’s work. The issue of formal elevation is not, therefore, ordinarily present in the relationship between the employee and his or her group manager. However, front line employees will frequently elevate issues informally to their group managers.
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Employees should communicate regularly and frequently with group managers, keeping them informed of the progress of their work, of unusual issues that present themselves, and of any problems they encounter in resolving or concluding their work.
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Among other things, employee should notify their group managers of matters that are beyond their training or competence, of procedures that work well or do not work well, and of the reaction of taxpayers to the manner in which TE/GE is serving them.
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Employees also should bring to their group managers’ attention any issue that must be elevated in accordance with a statute, a revenue procedure, a field directive, or the like. For example, an EO agent must forward to the TEGE National Headquarters office (addressed to the Director, EO Rulings and Agreements) a case presenting an issue requiring mandatory technical advice.
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Group managers have the initial responsibility to see that appropriate issues are elevated to the correct level. They are responsible for ensuring that matters within their group or branch that must be elevated in accordance with a statute, a revenue procedure, a field directive, or the like, are identified and appropriately elevated. They should be mindful of the reasons why issues are elevated and of the types of issues that are appropriate for elevation, as discussed above, and should insure the elevation of those issues when they surface within their group or branch.
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Senior mangers are the first level of management to which issues are formally elevated. In general, issues of local concern should be elevated to senior mangers. Issues of national concern also should be elevated to senior managers who, in most cases, will elevate them further to a national director or to the Commissioner or Deputy Commissioner, TE/GE.
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Senior Managers include:
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Area Managers
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Manager, EO Determinations
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Manager, EP Determinations
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Manager, EO Determination Quality Assurance
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Manager, EP Determination Quality Assurance
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Manager, EO Technical
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Manager, EP Technical
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Manager, EO Technical Quality Assurance
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Manager, EP Technical Guidance and Quality Assurance
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Manager, EO Projects/Voluntary Compliance
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Manager, EP Voluntary Compliance
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Manager, TEB Field Operations
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Director, Fed/State/Local
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Director, Indian Tribal Governments
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Manager, Field Operations, Tax Exempt Bonds
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The following types of issues are examples of those that should be elevated to TE/GE senior managers:
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Issues whose resolution has been delegated to managers and directors by delegation order, directive or practice;
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Issues that are novel or unprecedented;
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Issues involving a state, municipality or Indian tribal government within the area;
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Issues that are newsworthy within the area;
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Issues having an impact on customer service within the area;
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Complaints against employees or managers within the area;
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Issues relating to errors by TE/GE within the area;
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Issues relating to resources necessary to carry out TE/GE’s mission within the area.
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In general, issues of national concern should be elevated to directors, as appropriate. Directors include:
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EO Examination
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EP Examination
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EO Rulings and Agreements
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EP Rulings and Agreements
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Fed/State/Local Governments
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Indian Tribal Governments
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Tax Exempt Bonds.
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The following types of issues are examples of those that should be elevated to TEGE Directors.
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Issues of national concern;
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Issues whose resolution is vested in one of the Directors by statute, regulation, revenue procedure, functional statement, delegation order, other directive, or established practice;
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Issues relating to a substantial tax or legal matter involving a municipality, state or Indian tribal government;
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Issues relating to the revocation of a closing agreement or a compliance statements;
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Issues involving requests for section 7805(b) relief;
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Issues involving refunds to taxpayers of $1,000,000 or more, which must be reported to the Joint Committee on Taxation;
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Issues affecting an entire category of taxpayers, e.g., an issue affecting all tax- exempt bonds, or all gaming institutions;
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Issues relating to significant errors by TE/GE, or errors with national impact;
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Issues having a significant or enduring impact on customer service within a locality, an area, or throughout the country;
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Issues relating to discrimination, sexual harassment, or violation of taxpayers’ rights;
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Unusual personnel or labor relations questions;
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Matters reported to the Treasury Inspector General for Tax Administration (TIGTA), including violations of section 1105 of RRA (requests by specified Executive Branch employees concerning audits or other investigations);
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Disputes with other Federal agencies;
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Issues that are newsworthy within one or more areas, or nationally;
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Issues involving a large number of taxpayers, a large amount of money, or a well known entity or organization;
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Issues relating to investigations by the Government Accounting Office (GAO) or TIGTA.
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In general, matters of national concern, as outlined above in the discussion of matters elevated to the Directors, EO Exam, EP Exam, EO Rulings and Agreements, EP Rulings and Agreements, Fed/State/Local Governments, Indian Tribal Government, and Tax Exempt Bonds, are also candidates for elevation to the Directors, CAS, EO, EP and GE, as appropriate. The decision to elevate a matter to the Director, CAS, EO, EP or GE is within the discretion of the Directors, EO Exam, EP Exam, EO Rulings and Agreements, EP Rulings and Agreements, Fed/State/Local Governments, Indian Tribal Government, and Tax Exempt Bonds.
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Division Directors include:
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Director, Customer Account Services (CAS)
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Director, Exempt Organizations (EO)
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Director, Employee Plans (EP)
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Director, Government Entities (GE)
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The Directors, CAS, EO, EP and GE retain the authority to request that any issue under consideration at any level within their respective organizations be elevated to their offices.
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The Directors, CAS, EO, EP and GE retain the authority to request the Commissioner or Deputy Commissioner, TE/GE, to refer to the Senior Technical Advisor any issue under consideration at any level within their respective organizations. The decision to refer an issue to the Senior Technical Advisor rests in the sole discretion of the Commissioner or Deputy Commissioner.
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In general, issues of national concern, as outlined above in the discussion of matters elevated to the Directors, CAS, EO, EP, GE, EO Exam, EP Exam, EO Rulings and Agreements, EP Rulings and Agreements, Fed/State/Local Governments, Indian Tribal Governments, and Tax Exempt Bonds are also candidates for elevation to the Commissioner or Deputy Commissioner, TE/GE. The decision to elevate an issue to the Commissioner or Deputy Commissioner, TE/GE, is within the discretion of the Directors, CAS, EO, EP, GE, EO Exam, EP Exam, EO Rulings and Agreements, EP Rulings and Agreements, Fed/State/Local Governments, Indian Tribal Governments, and Tax Exempt Bonds.
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The Commissioner and the Deputy Commissioner, TE/GE retain the authority to request that any issue under consideration at any level within TE/GE be elevated to their offices.
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The Commissioner and the Deputy Commissioner, TE/GE, retain the authority, in his or her sole discretion, to refer any issue under consideration at any level within TE/GE to the Senior Technical Advisor for review or recommendation, in accordance with procedures established for the Office of the Senior Technical Advisor.
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Authority to decide several categories of issues is vested only in the Commissioner, TE/GE, and such issues must be elevated to that office. These include, but are not limited to:
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Issues relating to the revocation of closing agreements; and
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Issues relating to requests for section 7805(b) relief.
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In general, matters of national concern, as outlined above in the discussion of matters elevated to the Directors, CAS, EO, EP, and GE, are also candidates for elevation to the Commissioner, IRS.
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The decision to elevate a matter to the Commissioner, IRS, is within the discretion of the Commissioner or Deputy Commissioner, TE/GE.
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TE/GE employees and managers should refer to Counsel or consult with Counsel in those instances in which legal advice is needed to properly interpret and apply the Code, or when legal advice on other matters is needed. Such referral or consultation is often akin to elevation.
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Typically, referral or consultation is advised whenever the correct interpretation or application of law is uncertain, or when a taxpayer seriously challenges the position TE/GE has taken with respect to an issue.
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Counsel also is consulted to confirm that the judgment of TE/GE with respect to the Code is correct.
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Additionally, national and local procedures sometimes call for TE/GE employees to refer specific issues to Counsel for guidance or concurrence. For example, in the early days of the EP Closing Agreement Program (CAP), local CAP coordinators were asked to obtain Counsel’s concurrence on proposed CAP agreements.
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Area Counsel. In general, TE/GE employees and managers outside the Washington post of duty consult with Area Counsel which serves their post of duty.
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Washington Counsel. In general, TE/GE employees and managers in the Washington post of duty consult with the Washington office of Chief Counsel.
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In most instances, whenever TE/GE employees or managers refer non-routine matters to or consult with Counsel, employees and managers also should elevate to their immediate supervisors the facts giving rise to the referral or consultation.
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The following are examples of issues that TE/GE employees should bring to the attention of Counsel:
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Novel or unsettled issues of law;
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Cases in which the prospect of litigation is present, whether the prospect is remote or imminent;
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Cases in which referral to or consultation with Area Counsel is required by law, revenue procedure, other written directive or procedure, or local practice;
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Questions of disclosure, bankruptcy, summons, etc.;
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Proper implementation of new or amended Code provisions;
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Questions relating to proposed regulations, revenue procedures, announcements, notices and other forms of technical guidance;
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Resolution of Technical Advice cases in which novel, uncertain or unsettled issues of law are present;
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Unusual personnel or labor relations questions; or
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Disputes with other Federal agencies.
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Some issues must be reported to, or resolved by, an organization or entity outside the Internal Revenue Service. Although the referral of such issues outside the Service does not constitute the elevation of an issue to higher levels within the Service, understanding how such issues are to be dealt with is similar to understanding how issues are to be elevated. For that reason such referrals are discussed here.
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Joint Committee on Taxation. Under section 6405 of the Internal Revenue Code, notice of a refund or credit in excess of $1,000,000 must be given to the Joint Committee on Taxation at least 30 days before such a refund or credit is given.
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Treasury Inspector General for Tax Administration (TIGTA). In general, reports or allegations of employee waste, theft, fraud and wrongdoing must be referred to the TIGTA.
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Particular attention should be paid to Section 1105 of RRA’98 which added section 7217 of the Code. This section, with three exceptions, makes it unlawful for specified high-level Executive Branch employees to request an IRS employee to conduct or terminate a tax audit or other investigation of any particular taxpayer. Section 7217 further requires any employee to whom such a request is made to report the request immediately to the Treasury Inspector General for Tax Administration, and provides criminal penalties for failure to report such a request.
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Although the occurrence of illegal contacts under section 7217 also should be elevated to higher management and executives within TE/GE, it should be stressed that elevation within the Service is not sufficient to comply with the requirements of section 7217. Reports of such illegal contacts must be made directly to TIGTA.
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Department of Labor. Before disqualifying a plan qualified under section 401(a) of the Code for a violation of the exclusive benefit rule, the Director, Employee Plans must give the Secretary of Labor 60 days to object to the proposed disqualification.
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Pension Benefit Guaranty Corporation. Before granting or modifying a waiver of the minimum funding standard under section 412(d) of the Code, or before granting or modifying an extension of the amortization period under section 412(e) of the Code, the Director, Employee Plans must give the Pension Benefit Guaranty Corporation 30 days in which to comment.
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This existence of this section of the Manual should not lead employees and managers to hesitate to carry out responsibilities or make decisions that fall within their areas of responsibility and expertise. The Commissioner, TE/GE, and other high-ranking officials, cannot, and should not, make all decisions for TE/GE. Employees and managers should decide issues within their areas of responsibility and expertise.
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In considering whether an issue should be elevated, employees and managers should ask:
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Does the issue fall within my duties as defined in my position description?
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Am I evaluated on my ability to decide and handle issues of this nature?
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Am I authorized to make decisions or to handle matters of this sort?
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Are issues like this normally decided at my level?
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Is the issue one that has arisen before and can it be resolved according to an established practice or routine?
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Am I personally competent to decide or handle this issue?
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If the answer to these questions is yes, the issue usually should not be elevated.
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In some instances, exceptions should be made to the rules outlined above for elevating issues within the Internal Revenue Service. The rules outlined above are intended to serve as a guide, and to be indicative of the types of issues that should be elevated to particular levels. However, it is neither possible nor desirable to define with precision where each and every issue should be elevated. Discretion and judgment on the part of every employee, manager and executive is required to make a system of elevation work well.
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Those to whom an issue is elevated ordinarily have the discretion to decline to accept the elevation, and to refer it back down the chain of command to the place where the issue could be decided or resolved best. Of course, it is not appropriate to decline an elevation in cases in which the level of decision is established by statute, regulation, or delegation order, and re-delegation to a lower level is prohibited.
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Employees, managers and executives should bear the following in mind when considering the elevation of an issue:
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Routine or Trivial Matters. Routine or trivial matters ordinarily should not be elevated, even if they meet, in one fashion or another, one or more criteria for elevation. For example, a routine inquiry from a member of the Senate Finance Committee or the House Ways and Means Committee about the status of a determination letter application submitted by one of the Senator’s or Representative’s constituents need not be elevated, notwithstanding that the inquiry is coming from a member of one of the Congressional tax-writing committees.
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Political Appointees. The Internal Revenue Service has a practice of not involving political appointees (viz., the Commissioner of Internal Revenue and the IRS Chief Counsel) in the handling of specific taxpayer matters, to the degree possible. Matters involving specific taxpayer matters should, if possible, be resolved in the office of the Commissioner, TE/GE, or in the office of the Deputy Commissioner of Internal Revenue, rather than being elevated to the Commissioner of Internal Revenue or to the IRS Chief Counsel.
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Contacts by Certain Executive Branch Officials and Employees. Section 1105 of the Internal Revenue Restructuring and Reform Act of 1998 (RRA ‘98) prohibits certain Executive Branch officers and employees (the President, the Vice President, any employee of the executive offices of the President or Vice President, Cabinet Secretaries, the Commissioner of Social Security, the Director of National Drug Control Policy, the Director of the Office of Management and Budget, and the U.S. Trade Representative) to directly or indirectly request any IRS employee to conduct or terminate a tax audit or other investigation of any particular taxpayer, subject to three exceptions. Employees who receive such a request should immediately contact the local TIGTA office and report the incident. Employees may contact the TIGTA Hotline, 1-800-366-4484 if they are unable to contact the local TIGTA office. See, memorandum dated March 16, 2000 from Bob Wenzel to All Employees, "Section 1105 of the Internal Revenue Service (IRS) Restructuring and Reform Act of 1998 (RRA' 98)."
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In addition to contacting TIGTA, employees, managers, and executives should elevate the occurrence of such a contact up the chain of command for informational purposes, but no action should be taken on the request.
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From time to time, managers and executives of TE/GE will not wait for an issue to be elevated to them, but will reach down into the organization for the issue. That is, they will ask that an issue arising, being worked, or awaiting decision at a lower level of TE/GE be transferred to them for informational purposes, for review, or to be decided.
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Reaching down was uncommon under the old structure of EP/EO, and in many instances would have been inappropriate, because employees in the field answered to District Directors rather than to the Assistant Commissioner (EP/EO), and because the Assistant Commissioner (EP/EO) did not have line authority over the work performed in the field.
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However, the new structure of TE/GE is hierarchical, and requires that higher ranking managers and executives have the ability both to inquire about work being performed at every level of the organization, and to participate or become involved in it as necessary to accomplish a variety of purposes. This concept flows logically from the responsibility which the Commissioner, TE/GE has for accomplishing the mission of TE/GE, and for the manner in which the mission is accomplished.
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A manager or executive may reach down for an issue for a number of important and valid reasons, including the following:
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To become familiar with an emerging issue;
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To resolve a technical or administrative problem;
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To create uniformity throughout the Country in the administration of the law;
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To insure that quality control standards are met;
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To resolve a dispute or problem with taxpayers or within the Service; or
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To insure that the organization functions efficiently and properly.
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When a manager or executive does reach down into the organization for an issue, he or she generally should provide to the employee or manager working the issue an explanation of the reasons for involving himself or herself in the issue. Providing such an explanation will help insure that affected taxpayers and employees, and any entity making subsequent inquiry such as TIGTA or GAO, understand that the manager or executive has reached down for the issue for an appropriate reason.
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Although much of this section is devoted to a discussion of the circumstances in which issues should be elevated upward to increasingly senior managers and executives, there also are times when it is important for senior managers and executives to consult with front-line employees and managers when policies or procedures are developed.
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The ability of an organization to accomplish its purpose efficiently and accurately depends upon the ability of each employee, at every level, to understanding and expertly perform his or her job. It follows that, at every level of the organization, employees will develop specialized expertise.
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Some will have an expert understanding of the tax law we administer.
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Some will have an expert understanding of the needs and characteristics of the customers we serve.
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Others will have an expert understanding of the information systems we depend upon, or of the personnel system, or of how TE/GE coordinates with other divisions of the Service.
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This accumulated expertise, residing within employees at all levels and at all locations of TE/GE, represents an important asset of TE/GE that managers and executives should call upon as pertinent policies and procedures are developed. In developing policies and procedures, managers and executives should be mindful of the following principles:
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Front-line employees and managers with specialized information or experience should be consulted when policies or procedures within their area of expertise are under consideration;
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When an issue has been elevated, and several possible resolutions of the issue are under consideration, front-line employees and managers with specialized information or expertise concerning the taxpayer or the subject-matter area should be consulted as to the best solution;
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When an issue relating to the manner in which front-line work is to be performed is under consideration, front-line employees and managers with experience in performing the work should be consulted.
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