III. Transfer IRS Office of Chief Inspector Function
to Treasury Inspector General
A. Transfer IRS Internal Security and portions of Internal Audit to the
Treasury Inspector General.
The Commissioner will retain an appropriate number of internal
auditors for management matters. At least 900 of the approximately 1200 Treasury Inspector
General FTEs must be dedicated to IRS matters.
B. The Treasury Inspector General will be appointed by the President and
confirmed by the Senate.
In addition to the standard qualifications for an Inspector General
(e.g., appointed solely on the basis of integrity and demonstrated successful ability in
accounting, auditing, financial analysis, law, management analysis, public administration, or
investigations), the Treasury Inspector General must have experience in tax administration
and the demonstrated ability to lead a significant organization.
C. The Treasury Inspector General, Deputy Inspector General, and two
Assistant Deputies (Auditing and Inspection) may not be employed by the IRS within 2 years
before and 5 years after working at the Treasury Inspector General's office.
D. The Treasury Inspector General must have access to tax return and
E. Congress must be notified if the Secretary interferes with an ongoing
F. In addition to standard reporting requirements the Treasury Inspector
General should be responsible for reporting:
1. The number of taxpayer complaints during the period;
2. The number of employee misconduct and taxpayer abuse
allegations received during the period from taxpayers, IRS employees, and other sources;
3. The current status of each complaint and allegation;
4. The disposition of each complaint including the outcome of any
Justice Department action and any monies paid to settle suits; and
5. Whether restrictions on the use of enforcement statistics to
evaluate IRS employees are being followed and that required procedures to protect taxpayer
rights during collection enforcement actions are being followed.