Fifth Amendment Claim Ruled Not Frivolous

[Famspear]

......I'd also be interested to know whether the motion was reviewed in the Chief Counsel's national office.

What would the usual procedure be on something like that (i.e., under what circumstances would an IRS attorney out in the field submit something for review in the national office)?

[Dr. Caligari]

What would the usual procedure be on something like that (i.e., under what circumstances would an IRS attorney out in the field submit something for review in the national office)?

Someone who works, or worked, for the IRS can give you a better answer, but I can tell you that in the cases I handle in Tax Court, the IRS lawyers are always asking the judge for more time to file briefs because they have to "consult with national office." I don't know if they really consult or are just looking for more time, but I hear that A LOT.

[noblepa]

IANAL, and I've never appeared before the Tax Court (thank goodness), but consulting with Washington doesn't sound like an unreasonable thing to do.

The IRS, I'm sure, tries to keep their policies and the enforcement of the tax code as uniform as possible, in all parts of the country. So, if a lawyer in the field encounters anything unusual in a case before him/her, it would make sense to ask the central office if they or any other field office has encountered a similar situation, and if so, how it was resolved.

I'm sure that the IRS doesn't want its lawyers duplicating effort that other lawyers have already put forth or arguing points that the court has already decided.

[The Observer]

IANAL, and I've never appeared before the Tax Court (thank goodness), but consulting with Washington doesn't sound like an unreasonable thing to do.

The IRS, I'm sure, tries to keep their policies and the enforcement of the tax code as uniform as possible, in all parts of the country. So, if a lawyer in the field encounters anything unusual in a case before him/her, it would make sense to ask the central office if they or any other field office has encountered a similar situation, and if so, how it was resolved.

I'm sure that the IRS doesn't want its lawyers duplicating effort that other lawyers have already put forth or arguing points that the court has already decided.

Essentially, yes. From what I understand, local Area Counsels are not allowed to venture off into the weeds on legal issues without getting blessing from National Counsel first. Even revenue agents and revenue officers in seeking a legal opinion will have to wait for National to issue the opinion in writing.

[operabuff]

Here's an exhibit from the CCDM (counsel's part of the IRM) that describes which issues require national office review:

https://www.irs.gov/irm/part35/irm_35-0 ... html#d0e51

Item H is directly on point:

Nonfrivolous constitutional challenges to statutes, regulations, published guidance or Service administrative practices or any nonfrivolous assertion of the application of the Religious Freedom Restoration Act. Examples of frivolous constitutional issues that need not be reviewed are contained in The Truth About Frivolous Tax Arguments that can be found at http://www.irs.gov/pub/irs-utl/friv_tax.pdf

So if the field attorney recognized it as a nonfrivolous challenge, review would have been required. It appears that he didn't, so perhaps the MSJ was not reviewed.

Addendum: Here's a 2014 revision of the CCDM list above: https://www.irs.gov/pub/irs-ccdm/cc%202014%20005.pdf

It contains the same language about nonfrivolous constitutional arguments as the earlier list. Neither list contains any international issues, so somewhere around there's got to be something that specifies which international issues require review. I would think FBAR might be on that list.

[operabuff]

I'm sure that the IRS doesn't want its lawyers duplicating effort that other lawyers have already put forth or arguing points that the court has already decided.

They also don't want their lawyers taking an one approach to an issue in a case, and having a contradictory position argued by some lawyers elsewhere in a different case. And they particularly don't want lawyers taking a position that would contradict some as yet to be issued published guidance.

[Duke2Earl]

I was an Assistance Chief Counsel at the IRS in the late 80's. At the time they were trying to design and implement a computer system called "Case." The intent was to have a central Chief Counsel computer system where all positions and briefs and decisions could be entered classified by UIL number (Uniform Issue List). It was also intended that folks at the Tax Division at Justice would also participate and then there would actually be coordination. Everyone could see what everyone else was doing and then (in this perfect world) there would be no contrary positions taken. It was never implemented. The budget for it disappeared. So far as I know, even though it's been over 25 years it has still never been implemented. I believe to this day, all coordination is still informal. If someone wants to coordinate their case with Chief Counsel they do, if not, they don't. And yes, telling a court they have to coordinate with the IRS is a wonderful way to stall if desired.

[AndyK]

CASE exists.

I can speak authoritatively because I was one of the computer geeks who implemented it.

However, it is NOT open to DoJ due to (amother other issues) incompatible computer systems and probably never will be. There's this little law about IRS making tax information available to outsiders (even DoJ) until the taxpayer has petitioned Tax Court and filed the documents or indirectly allows IRS to enter the (heavily redacted) documents as evidenece.

[operabuff]

I was an Assistance Chief Counsel at the IRS in the late 80's. At the time they were trying to design and implement a computer system called "Case." The intent was to have a central Chief Counsel computer system where all positions and briefs and decisions could be entered classified by UIL number (Uniform Issue List). It was also intended that folks at the Tax Division at Justice would also participate and then there would actually be coordination. Everyone could see what everyone else was doing and then (in this perfect world) there would be no contrary positions taken. It was never implemented. The budget for it disappeared. So far as I know, even though it's been over 25 years it has still never been implemented. I believe to this day, all coordination is still informal. If someone wants to coordinate their case with Chief Counsel they do, if not, they don't. And yes, telling a court they have to coordinate with the IRS is a wonderful way to stall if desired.

I'm not sure who you'd have been talking to, but coordination with the national office is not optional with regard to issues on the list I provided in one of my previous posts on this thread. It is supposed to start out informally when the case is initially received in the field. At that time the field and the national office will decide the level of coordination required from that point forward. As AndyK points out, the CASE tracking system was implemented. Even before CASE was implemented, Counsel had something called CATS which was capable of tracking by UIL number. In fact, CATS was more suitable for litigation management than CASE and remains in use today, I believe.

For those interested in Chief Counsel history, up until around 1990 or so, Counsel's national office had litigation divisions that were responsible for coordinating the positions taken in litigation by field attorneys. At one point there were divisions for the Tax Court, Refund litigation, General Litigation (collection, summons and bankruptcy), Disclosure Litigation, and General Legal Services (non tax). Tax Court and Refund merged into the Tax Litigation Division. This system did quite well for coordinating the litigation, but was a little clumsy at meshing litigation with published guidance and ruling positions. (Which themselves were handled by separate divisions) So along about 1985, a bright young fellow named Kevin Dolan created the International Division which encompassed litigation coordination of all cases with the rulings and regulations. The Employee Plans and Exempt Organizations division followed shortly thereafter, combining exempt orgs and pension plans issues along the international model. In about 1996, the whole of the national office was reorganized along the International model.

(While all this was going on in the national office, the field offices were going through a few reorganizations of their own, culminating in the reorganization mandated by RRA 98 along customer lines.) The organizational structure has remained pretty stable from 2000 forward.

Chief Counsel attorneys must coordinate with Justice attorneys on cases in the District Courts and Court of Federal Claims , but it's pretty rare on Tax Court cases. In most instances, the only time DoJ will see a Tax Court case is if it's appealed, or being considered for a government appeal. I would add to AndyK's comment about system incompatibility that there are also jurisdictional issues (and disclosure issues) that prevent sharing the systems. Counsel doesn't have access to DoJ's system either.

[AndyK]

FWIW: CASE is (at least now) an acronym for Counsel Automated Systems Environment. It encompassses all automated tools used by Counsel attorneys and staff.

CATS, still alive and kicking, is a subset of CASE. CATS is the case and issue tracking portion of CASE.

There are a couple of other neat systems within CASE; such as the one which receives daily transmissions of all documents from Tax Court and automatically routes them to the appropriate, responsible office plus copying the various parties in the National Office responsible for oversight. It cut the time for field offices to receive Court documents from around a week to 24 hours.

[Duke2Earl]

In some respects, I am Chief Counsel history. I was one of Kevin Dolan's technical advisors. I was one of the group that reorganized Chief Counsel to get rid of Interp and L&R. Glad to hear they eventually implemented CASE. I hope it works better than most IRS software, especially considering the amount of time and money invested. But one thing I know for certain about Chief Counsel is just because there's rule that says someone must do something does not mean that it always actually happens. The examples of that are legion. And just because something is available for reading does not mean that it is actually read.

[The Observer]

Another case was appealed from the 3rd Circuit to the Supreme Court on a similar issue, and the Court denied cert.

US v. Eli and Renee Chabot
No. 14-4465, US Court of Appeals for 3rd Circuit, 793 F.3d 338

[Famspear]

Professor Keith Fogg at Villanova Law School has a weblog entry with a commentary on the Youssefzadeh case:

http://www.procedurallytaxing.com/legit ... n-penalty/