The Framework of the Internal Revenue Service

Just what exactly is the IRS?

Many can describe what the Internal Revenue Service (IRS) does through personal experiences, some good and some bad. Have you ever wondered, though, just what the IRS is? The IRS is a branch of the U.S. Treasury Department, and it is supervised by a Commissioner who is appointed by our President.

Though its main headquarters are in Washington, D.C., the IRS has regional campuses that process over 200 million tax filings, including over 145 million individual income tax returns. These campuses collect over one trillion dollars in tax payments each year. They are located in Andover, Atlanta, Austin, Cincinnati, Fresno, Brookhaven, Kansas City, Memphis, Ogden, and Philadelphia. The IRS also consists of local offices that reside in major cities.

The IRS is composed of multiple divisions that are organized according to their function. As a result of the Internal Revenue Service Restructuring and Reform Act of 1998, the IRS now functions under four major operating divisions: Small Business/Self-Employed (SB/SE), Wage and Investment, Tax-Exempt and Government Entities, and Large Business and International. Each of these divisions has its own organizations. For example, the SB/SE division contains Collection, Campus Operations, Examination, Specialty Taxes and Communications and Stakeholder Outreach.

Criminal investigation is the “police force” of the Internal Revenue Service. The employees are called ‘special agents,’ and they investigate taxpayers that are suspected of a potential tax crime.

Examination personnel within the IRS perform audits. The people who audit tax returns are either tax auditors working internally the local IRS office or revenue agents who often will conducts audits at a taxpayer’s place of business. The Taxpayer Advocate Service (TAS) is the IRS’ troubleshooters to call on when a taxpayer can’t get their tax problems solved through normal IRS channels. The TAS officers are found at both IRS campuses and local IRS offices.

Last but not least, collection personnel collect tax dollars from people who haven’t voluntarily and timely paid their taxes. The IRS has a computerized system called the Automated Collection System (ACS). If someone owes the IRS money, this is the program that lets the IRS know. The ACS is a highly computerized collection system staffed by ACS personnel. If you’ve ever been contacted by an IRS revenue officer, it may be because you were unfortunate enough to first be selected by ACS.

The number of IRS permanent and seasonal employees at all these levels vary from year to year. The IRS is, however, the United States’ largest federal bureaucracy and is comprised of auditors (25%), collectors (15%), and criminal investigators (3%). The other 57% of IRS personnel determine policy, run the IRS’ computer system, and answer taxpayer inquiries.

Written by Robert V. Boeshaar

Robert V. Boeshaar

Robert V. Boeshaar is a Seattle tax attorney committed to helping individuals and small businesses who are facing problems with the IRS. He believes in using his experience to serve others and to make a difference in their lives.