26 USC 7803: IRS Commissioner and Taxpayer Advocate

The U.S. tax code, specifically 26 USC 7803, provides the organizational structure for the Internal Revenue Service (IRS). This statute establishes the agency’s leadership positions and creates a system for taxpayer protection. It defines the roles responsible for administering the nation’s tax laws while also embedding an internal check on the agency’s authority.

IRS Commissioner and Chief Counsel

The statute establishes the leadership of the IRS, headed by the Commissioner of Internal Revenue. The Commissioner is appointed by the President with the Senate’s consent for a five-year term and must have demonstrated management ability. Their primary duty is the overall management, direction, and supervision of the application of the tax code. The President can remove the Commissioner at will, and the Commissioner may be reappointed.

Working alongside the Commissioner is the Chief Counsel for the IRS, the agency’s principal legal officer. This role is also a presidential appointment confirmed by the Senate. The Chief Counsel provides legal advice to the Commissioner and other IRS personnel, and their office represents the IRS in most litigation before the U.S. Tax Court. This structure separates the administrative functions led by the Commissioner from the legal interpretations managed by the Chief Counsel.

The Taxpayer Advocate Service

The law also mandates the Taxpayer Advocate Service (TAS), an independent organization within the IRS. Its mission is to serve as the taxpayer’s voice. The TAS is structured to assist taxpayers in resolving problems with the IRS and to identify and propose solutions for systemic issues that cause taxpayer difficulties. This allows the TAS to provide both individual relief and broad-based recommendations to improve tax administration.

Leading this organization is the National Taxpayer Advocate, who is appointed by the Secretary of the Treasury after consultation with the IRS Commissioner. To ensure independence, the law stipulates that the appointee cannot have been an IRS employee for the two years prior to the appointment and must agree not to work for the IRS for at least five years after leaving the position. The National Taxpayer Advocate reports directly to the IRS Commissioner and oversees a network of local taxpayer advocates available to provide direct assistance.

The TAS helps ensure that taxpayer rights are protected and that the tax system is fair. The National Taxpayer Advocate submits annual reports to Congress that identify recurring problems taxpayers face and suggest legislative remedies. These reports provide a tool for enacting change and holding the IRS accountable.

Taxpayer Assistance Orders

A primary tool available to the Taxpayer Advocate Service is the Taxpayer Assistance Order (TAO). A TAO is a legally binding directive that the National Taxpayer Advocate can issue to compel the IRS to take, or refrain from taking, a specific action. This authority is a remedy for taxpayers who are facing significant harm. The decision to issue a TAO is based on a determination that a taxpayer is experiencing or is about to experience a “significant hardship.”

Significant hardship involves serious, adverse impacts on the taxpayer. This could include an immediate threat of adverse action, a delay of more than 30 days in resolving a taxpayer’s account problems, or the taxpayer incurring significant costs, such as professional fees, to resolve the issue. The standard also covers irreparable injury to, or a long-term adverse impact on, the taxpayer if relief is not granted.

A TAO can provide tangible relief. For example, a TAO can order the IRS to release a levy on a taxpayer’s wages or bank account. It can also compel the agency to cease a collection action, review a case, or expedite the issuance of a tax refund. The terms of the TAO are tailored to the specific circumstances of the taxpayer’s case, providing a flexible mechanism for resolving disputes.