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H.R. 5346 · House bill · 119th Congress
This bill provides that an Internal Revenue Service (IRS) employee’s immediate supervisor for purposes of approving certain federal tax penalties is the person to whom such employee reports. The bill also provides that an immediate supervisor’s approval of certain federal tax penalties must be obtained (in writing) before any written communication related to such penalties is sent to the taxpayer.
As background, current law requires that the initial determination by an IRS employee to assess certain federal tax penalties be approved (in writing) by such employee’s immediate supervisor (or a designated higher-level official). Under IRS regulations, an immediate supervisor is any individual with responsibility to review another individual’s proposed federal tax penalties (without such proposal being subject to an intermediary’s approval). The IRS regulations also establish requirements for when such approval must be obtained based on whether the federal tax penalty is subject to pre-assessment review or raised in Tax Court proceedings.
This Act may be cited as the “Fair and Accountable IRS Reviews Act”.
(a) Approval of assessment.— Section 6751(b)(1) of the Internal Revenue Code of 1986 is amended to read as follows:
“(1) In general.— No penalty under this title shall be assessed or entered unless, before any written communication with respect to such penalty (including proposal of a penalty as an adjustment) is sent to the taxpayer, the initial determination of such assessment is personally approved (in writing) by the immediate supervisor of the individual making such determination or such higher level official as the Secretary may designate.”.
(b) Immediate supervisor defined.— Section 6751(b) of such Code is amended by adding at the end the following new paragraph:
“(3) Immediate supervisor.— For purposes of this subsection, the term “immediate supervisor” means, with respect to an individual making a determination under paragraph (1), the person to whom such individual reports.”.
(c) Effective date.— The amendments made by this section shall apply to notices issued, and penalties assessed, after December 31, 2025.