Taxpayer Bill of Rights  

Press Release #105-301

IRS Oversight Hearings Day One:
IRS High Level Exec's Held to
Different Standards than Employees;
Tax Attorneys Tell of Extreme Law Enforcement
Techniques Used Against Clients

WASHINGTON -- The Senate Finance Committee will hold the first of four days of oversight hearings on the Internal Revenue Service. The hearing will begin at 9:00 am in room 216 of the Hart Senate Office Building.

Among the witnesses expected to testify before the Committee on Tuesday are:

Panel # 1
Richard Calahan, Deputy Inspector General, Office of the Inspector General at the Department of Treasury
Harry Patsalides, Deputy Assistant Inspector General for Investigation, Department of the Treasury

Panel #2
Mr. Robert E. Davis, attorney, Dallas, Texas
Mr. Earl, J. Epstein, attorney, Philadelphia, Pennsylvania
Mr. Philip MacNaughton, attorney, Houston, Texas
Honorable Cody Mayo, Assistant District Attorney of the Caddo Parish, Louisiana

Day I Summary

The first panel will present evidence that the IRS holds high-level executives to a different standard than other employees within the Service. Sometimes they are treated differently even when they have committed the same offense. Such inequities, for the benefit of executive level employees, send the wrong message to the average workers, and it destroys morale throughout the agency.

The second panel will focus on how the IRS is increasingly using extreme law enforcement techniques against ordinary taxpayers. The number of taxpayers abused by the agency indicates there is a problem with the culture of the IRS that does little to prevent this abuse. When such abuse of taxpayers or other wrongdoing by agents is reported, oftentimes it goes unpunished. This failure of management also harms IRS employees themselves who are sometimes punished for reporting wrongdoing by IRS management.

Summary of testimony of R. Calahan
(no summary available -- Calahan to introduce Patsalides)

Summary of testimony of H. Patsalides

  • The IRS does not refer complaints about high level employees to the IG in a timely manner.
  • The IRS has been slow in taking administrative action against certain IRS employees.
  • IG views some adjudicative actions taken by the IRS against high level employees as weak decisions.
  • The IG is hampered in getting access to tax information.
  • IRS management appears to treat managers differently than employees when it pertains to disciplinary action.
  • If an employee files a grievance, an EEO complaint, or a lawsuit against an IRS manager and the employee wins the settlement, usually no disciplinary action is taken against the manager for allegedly violating the rights of the employee.
  • IG's investigation of Jennifer Long's allegations has led to possibly six new cases being opened.

Summary of testimony of Robert E. Davis

  • The IRS is using intrusive and abusive law enforcement techniques more appropriate to the FBI or DEA.
  • Treasury IG is not up to the task of investigating and correcting IRS agent misconduct when it occurs.

As the IRS Criminal Investigation Division (CID) has been increasingly used in the suppression of drugs and organized criminal activity, its special agents have learned the investigative techniques which are employed by the DEA, FBI and local law enforcement to deal with violent and dangerous criminals. These investigative strategies are 'borrowed' and used by IRS CID in routine criminal tax investigation of taxpayers who are neither dangerous nor violent.

In addition to the misuse of intrusive and even oppressive investigative techniques within the agency, there are sometimes serious integrity issues within the Agency. The Office of the Inspector General of the Treasury (OIG-Treasury) is not up to the task of investigating and correcting IRS agent misconduct when it occurs.

SSsummary of testimony of Earl J. Epstein

  • Harassment and overreaching by the Collection Division of the Internal Revenue Service is frequent.
  • These practices could not continue without institutional approval.
  • The Senate Finance Committee should consider making the IRS subject to the same rules of conduct imposed on the private sector.

Summary of testimony of Philip MacNaughton

  • An IRS officer's abusive actions may have hounded a Houston taxpayer to death.
  • IRS abuse is not a series of isolated events. It is the IRS culture that increasingly permits and encourages taxpayer abuse.
  • The best way to end IRS abuse is to reform the tax system.

Summary of testimony of Ray Cody Mayo, Jr.

  • Most employees of the IRS are loyal public servants trying to do a most difficult and thankless job.
  • Too many of these loyal public servants have themselves become victims of the IRS culture, and have been singled out for abuse and discrimination by an agency that in all fairness, is out of control.
  • The agency appears to have directly targeted lawyers who represent taxpayers, in an effort to intimidate, with the ultimate goal of making lawyers think twice about zealously representing taxpayers. Mr. Mayer was, and still may be, the target of such an agency attack.

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