IRS Workers Don't Harass Taxpayers, Says Government Watchdog

Mike Godfrey, Tax-news.com, Washington

16 August 2000

The Internal Revenue Service has been exonerated of bullying taxpayers; in fact its employees are more to be pitied than feared, according to first results from the Congress's new watchdog, the Treasury Inspector General for Tax Administration.

Two years ago, the Congress, warned in hearings that the Internal Revenue Service was bullying many innocent Americans, passed a law requiring that the agency fire workers who harassed taxpayers. But not one of the first 830 complaints of taxpayer harassment filed under the new law has been upheld.

In fact, investigations by the IRS and the watchdog found evidence that some of the complaints were bogus, made in an effort to derail audits and tax collections. Others were either without merit or involved misconduct that fell far short of the Congressional definition of harassment.

A spokesman for Senator William V. Roth Jr., the Delaware Republican who sponsored the 1998 IRS Reform and Restructuring Act, said the results showed that IRS employees "are adhering to the law", adding that perhaps the existence of the law had helped to control their behaviour.

Other commentators say the new law may have gone too far in subjecting employees to extreme scrutiny. The New York Times reports that Rep. Lloyd Doggett (Dem, Texas) who sits on the House Ways and Means Committee, said that while he voted for the law because he heard evidence of abuses, he thinks Congress has gone too far in restricting the agency.

Mr. Doggett said he now thought the 1998 law was "another example of the Republican priority of demonizing the IRS and limiting its resources to fulfill its responsibilities, which I believe is all aimed at trying to end income taxation."

One result of the new law has been that IRS agents have become much less aggressive in pursuing tax dodgers. Some prominent tax advisers said in interviews last year that they were amazed that the IRS was not trying to collect taxes owed by their clients.

The new data, which was buried in a routine report issued by the Congressional Joint Committee on Taxation last week, was first disclosed yesterday by Tax Notes, a weekly journal.

The data showed that between July 1998 when the law was enacted and last May, the IRS fired 4 of its 16,000 auditors for improperly threatening to audit a taxpayer. None of these cases rose to the level of what Congress called harassment because they involved spontaneous outbursts, not the wilful misuse of the law, regulations or policies.

One case involved an auditor arrested for drunken driving off-duty who told a police officer that he would "find out" about him and have "a good time" with him. The auditor asserted that his judgment was impaired and noted that he never mentioned an audit, but the IRS rejected the claim and fired him anyway.

The tax agency also dismissed 102 of its 88,000 workers for failing to file tax returns. Colleen Kelley, president of the National Treasury Employees Union, which represents IRS workers, said: "The law is unnecessary and I would like to see it repealed or at least revised. It fixes a problem that doesn't exist." Ms. Kelley said any organization would have some misconduct in its ranks, but that 4 cases of misconduct among 16,000 auditors was insignificant.

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