Final regs update guidance on Taxpayer Assistance Orders T.D. 9519, 03/31/2011 ; Reg. § 301.7811-1 ............................................................................................. IRS has issued final regs that update guidance on the issuance of Taxpayer Assistance Orders (TAOs). The regs reflect changes made by the Taxpayer Bill of Rights II (TBOR II), the Internal Revenue Service Restructuring and Reform Act of '98 (RRA '98), the Community Renewal Tax Relief Act of 2000, and the American Jobs Creation Act of 2004 (AJCA). The final regs, which apply for TAOs issued on or after Apr. 1, 2011, adopt the previously issued proposed regs with minor changes. .............................................................................................. Background. Upon an application filed by a taxpayer with the Office of the Taxpayer Advocate, the National Taxpayer Advocate (NTA) can issue a TAO if, in the determination of the NTA, the taxpayer is suffering or is about to suffer a significant hardship as a result of the manner in which the tax laws are being administered by IRS, or if the taxpayer meets such other requirements provided in regs. ( Code Sec. 7811 ) A “significant hardship” includes: an immediate threat of adverse action; a delay of more than 30 days in resolving taxpayer account problems; the incurring by the taxpayer of significant costs (including fees for professional representation) if relief isn't granted; or irreparable injury to, or a long-term adverse impact on, the taxpayer if relief isn't granted. ( Code Sec. 7811(a)(2) ) A TAO may be issued to direct an IRS operating division or function to take a specific action, cease a specific action, or refrain from taking a specific action, or to order IRS to review at a higher level, expedite consideration of, or reconsider, a taxpayer's case. ............................................................................................... A taxpayer requests a TAO on Form 911, “Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order).” The NTA may issue a TAO ordering IRS within a specified time to: ........................................................................................ (1) release levied property; or ......................................................................................... (2) cease any action, take any action as permitted by law, or refrain from taking any action with respect to a taxpayer under the Code provisions relating to: (a) the collection of tax ( Code Sec. 6301 to Code Sec. 6304 ), (b) the immediate assessment of taxes in receivership and bankruptcy proceedings ( Code Sec. 6871 to Code Sec. 6873 ), (c) the discovery of liability and enforcement of title ( Code Sec. 7601 to Code Sec. 7655 ), and (d) any other provision of law that is specifically described by the NTA in the TAO. ( Code Sec. 7811(b) ) In July of 2009, IRS issued proposed regs on TAOs, which replaced proposed regs issued in '96 ('96 regs) that were withdrawn because they were outdated by subsequent legislation. ........................................................................................... Final regs. The final regs adopt the proposed regs without substantive changes. The example in Prop Reg § 301.7811-1(a)(4)(iv) , illustrating what is a significant cost for purposes of a significant hardship, has been slightly reworded, but the fact pattern and conclusion basically remain the same. ......................................................................................... In addition, the final regs remove Reg. §301.7811-1(g), which in the existing final regs had defined the term “ombudsman,” because amendments to Code Sec. 7811 in the RRA '98 had replaced this term with “National Taxpayer Advocate.” However, Reg. § 301.7811-1(e) of the existing final regs ( T.D. 8403, 03/20/1992 , effective Mar. 20, '92)—which contains the term “ombudsman” and concerns the suspension of the statute of limitations—has not been revised by the final regs because such changes might involve changes to IRS's computer processing systems. T.D. 9519, 03/31/2011 , provides that all references to the term “ombudsman” in Reg. § 301.7811-1(e) should, consistent with Code Sec. 7811 , be construed as referring to the “National Taxpayer Advocate.” ......................................................................................... TD 9519. Taxpayer Assistance Orders ........................................................................................ AGENCY: Internal Revenue Service (IRS), Treasury. ACTION: Final regulations. SUMMARY: This document contains final regulations relating to taxpayer assistance orders. These regulations reflect changes to the law made by the Taxpayer Bill of Rights II, the Internal Revenue Service Restructuring and Reform Act of 1998, the Community Renewal Tax Relief Act of 2000, and the American Jobs Creation Act of 2004. The final regulations affect taxpayers in cases where a taxpayer assistance order is being considered or issued. DATES: Effective date: These regulations are effective on [INSERT DATE OF PUBLICATION OF THIS DOCUMENT IN THE FEDERAL REGISTER]. Applicability date: For dates of applicability, see §301.7811-1(f). FOR FURTHER INFORMATION CONTACT: Janice R. Feldman, (202) 622-8488 (not a toll-free number). SUPPLEMENTARY INFORMATION: ......................................................................................... Background ............................................................................................. These final regulations contain rules related to taxpayer assistance orders under (Code). These regulations are necessary to reflect changes to the law made by the Taxpayer Bill of Rights II (TBOR 2), the Internal Revenue Service Restructuring and Reform Act of 1998 (RRA 98), the Community Renewal Tax Relief Act of 2000, and the American Jobs Creation Act of 2004. On July 27, 2009, a notice of proposed rulemaking () relating to taxpayer assistance orders was published in the Federal Register (74 FR 36973). No comments were received from the public in response to the notice of proposed rulemaking. No public hearing was requested or held. The proposed regulations are adopted without substantive change by this Treasury decisionwith one exception. Example 3 in §301.7811-1(a)(4)(iv) of the regulations illustrating significant costs was revised slightly. ........................................................................................... Furthermore, §301.7811-1(g) of the final regulations ( TD 8403 ) published on March 23, 1992, in the Federal Register (57 FR 9975) defined the term “Ombudsman.” After these final regulations were published, section 101 of TBOR 2, Public Law 104-168, 110 Stat. 1452 (1996), amended section 7811 by changing the name of the “Ombudsman” to the “Taxpayer Advocate.” Section 1102 of RRA 98, Public Law 105-206, 112 Stat. 685 (1998), further amended section 7811, by replacing “Taxpayer Advocate” with “National Taxpayer Advocate.” Thus, §301.7811-1(g), which defined the obsolete term “ombudsman” is being removed by these final regulations as it is obsolete. Section 301.7811-1(e) of the existing final regulations ( TD 8403 ), which contains the term “ombudsman” and concerns the suspension of the statute of limitations, was not revised by these final regulations as changes to that section may involve changes to IRS computer processing systems. Thus, all references to the term “ombudsman” in §301.7811-1(e) should, consistent with the current version of the statute, be construed as referring to the “National Taxpayer Advocate.” Possible revisions to §301.7811-1(e) will be considered at a later date. ............................................................................................. Special Analyses .......................................................................................... It has been determined that this Treasury decisionis not a significant regulatory action as defined in Executive Order 12866. Therefore, a regulatory assessment is not required. It has also been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to these regulations. Pursuant to the Regulatory Flexibility Act (5 U.S.C. chapter 6), it is hereby certified that these regulations will not have a significant economic impact on a substantial number of small entities. The information required under this Treasury decisionis already required by the current regulations and the Form 911, “Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order).” In addition, the Form 911 takes minimal time and expense to prepare, and the filing of a Form 911 is optional. Therefore, preparing the Form 911 does not significantly increase the burden on taxpayers. Based on these facts, the Treasury Department and the IRS have determined that these regulations will not have a significant economic impact on a substantial number of small entities. Furthermore, the substance of the regulations does not concern the Form 911, but the procedures the Taxpayer Advocate Service (TAS) or the Internal Revenue Service (IRS) must follow with respect to taxpayer assistance orders. Therefore, any burden created by these regulations is on the TAS or IRS, not taxpayers. Pursuant to section 7805(f) of the Code, the notice of proposed rulemaking preceding these regulations was submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small business. ....................................................................................... Drafting Information The principal author of these regulations is Janice R. Feldman, Office of the Special Counsel (National Taxpayer Advocate Program)(CC:NTA). List of Subjects in Employment taxes, Estate taxes, Excise taxes, Gift taxes, Income taxes, Penalties, Reporting and recordkeeping requirements. Adoption of the Amendments to the Regulations Accordingly, is amended as follows: PART 301—PROCEDURE AND ADMINISTRATION Paragraph 1. The authority citation for part 301 continues to read in part as follows: Authority: 26 U.S.C. 7805 *** Par. 2. Section 301.7811-1 is amended by revising paragraphs (a),(b), (c) and (d), removing paragraphs (f), (g), (h) and redesignating paragraph (h) as (f) and revising newly designated paragraph (f) to read as follows: ........................................................................................... Reg § 301.7811-1. §301.7811-1 Taxpayer assistance orders. ......................................................................................... (a) Authority to Issue—(1) In general. When an application for a taxpayer assistance order (TAO) is filed by the taxpayer or the taxpayer's authorized representative in the form, manner and time specified in paragraph (b) of this section, the National Taxpayer Advocate (NTA) may issue a TAO if, in the determination of the NTA, the taxpayer is suffering or is about to suffer a significant hardship as a result of the manner in which the internal revenue laws are being administered by the Internal Revenue Service (IRS), including action or inaction on the part of the IRS. ................................................................................................ (2) The National Taxpayer Advocate defined. The term National Taxpayer Advocate includes any designee of the NTA, such as a Local Taxpayer Advocate. ................................................................................................. (3) Issuance without a written application. The NTA may issue a TAO in the absence of a written application by the taxpayer under section 7811(a). ........................................................................................ (4) Significant hardship—(i) Determination required. Before a TAO may be issued, the NTA is required to make a determination regarding significant hardship. ........................................................................................... (ii) Term defined. The term significant hardship means a serious privation caused or about to be caused to the taxpayer as the result of the particular manner in which the revenue laws are being administered by the IRS. Significant hardship includes situations in which a system or procedure fails to operate as intended or fails to resolve the taxpayer's problem or dispute with the IRS. A significant hardship also includes, but is not limited to: ........................................................................................ (A) An immediate threat of adverse action; ...................................................................................... (B) A delay of more than 30 days in resolving taxpayer account problems; .................................................................................... (C) The incurring by the taxpayer of significant costs (including fees for professional representation) if relief is not granted; or ....................................................................................... (D) Irreparable injury to, or a long-term adverse impact on, the taxpayer if relief is not granted. .................................................................................... (iii) A delay of more than 30 days in resolving taxpayer account problems is further defined. A delay of more than 30 days in resolving taxpayer account problems exists under the following conditions: ........................................................................................ (A) When a taxpayer does not receive a response by the date promised by the IRS; or (B) When the IRS has established a normal processing time for taking an action and the taxpayer experiences a delay of more than 30 days beyond the normal processing time. (iv) Examples of significant hardship. The provisions of this section are illustrated by the following examples: ............................................................................................. Example 1. Immediate threat of adverse action. The IRS serves a levy on A's bank account. A needs the bank funds to pay for a medically necessary surgical procedure that is scheduled to take place in one week. If the levy is not released, A will lack the funds necessary to have the procedure. A is experiencing an immediate threat of adverse action. Example 2. Delay of more than 30 days. B files a Form 4506, “Request for a Copy of Tax Return.” B does not receive the photocopy of the tax return after waiting more than 30 days beyond the normal time for processing. B is experiencing a delay of more than 30 days. ............................................................................................. Example 3. Significant costs. The IRS sends XYZ, Inc. a notice requesting payment of the outstanding employment taxes and penalties owed by XYZ, Inc. The notice indicates that XYZ, Inc. has small employment tax balances with respect to 12 employment tax quarters totaling $10X. XYZ, Inc. provides documentation to the IRS which it contends shows that if all payments were applied to each quarter correctly, there would be no balance due. The IRS requests additional records and documentation. Because there are 12 quarters involved, to comply with this request XYZ, Inc. asserts that it will need to hire an accountant, who estimates he will charge at least $5X to organize all the records and provide a detailed analysis of how to apply the deposits and payments. XYZ, Inc. is facing significant costs. ........................................................................................... Example 4. Irreparable injury. D has arranged with a bank to refinance his mortgage to lower his monthly payment. D is unable to make the current monthly payment. Unless the monthly payment amount is lowered, D will lose his residence to foreclosure. The IRS refuses to subordinate the Federal tax lien, as permitted by section 6325(d), or discharge the property subject to the lien, as permitted by section 6325(b). As a result, the bank will not allow D to refinance. D is facing an irreparable injury if relief is not granted. ............................................................................................. (5) Distinction between significant hardship and the issuance of a TAO. A finding that a taxpayer is suffering or about to suffer a significant hardship as a result of the manner in which the internal revenue laws are being administered by the IRS will not automatically result in the issuance of a TAO. ........................................................................................... After making a determination of significant hardship, the NTA must determine whether the facts and the law support relief for the taxpayer. In cases where any IRS employee is not following applicable published administrative guidance (including the Internal Revenue Manual), the NTA shall construe the factors taken into account in determining whether to issue a TAO in the manner most favorable to the taxpayer. ................................................................................................... (b) Generally. A TAO is an order by the NTA to the IRS. The IRS will comply with a TAO unless it is appealed and then modified or rescinded by the NTA, the Commissioner, or the Deputy Commissioner. If a TAO is modified or rescinded by the Commissioner or the Deputy Commissioner, a written explanation of the reasons for the modification or rescission must be provided to the NTA. The NTA may not make a substantive determination of any tax liability. A TAO is also not intended to be a substitute for an established administrative or judicial review procedure, but rather is intended to supplement existing procedures if a taxpayer is about to suffer or is suffering a significant hardship. A request for a TAO shall be made on a Form 911, “Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order)” (or other specified form) or in a written statement that provides sufficient information for the Taxpayer Advocate Service (TAS) to determine the nature of the harm or the need for assistance. A taxpayer's right to administrative or judicial review will not be diminished or expanded in any way as a result of the taxpayer's seeking assistance from TAS. ......................................................................................... (c) Contents of taxpayer assistance orders. After establishing that the taxpayer is facing significant hardship and determining that the facts and law support relief to the taxpayer, the NTA may issue a TAO ordering the IRS within a specified time to— (1) Release a levy. Release levied property (to the extent that the IRS may by law release such property); or ......................................................................................... (2) Take certain other actions. Cease any action, take any action as permitted by law, or refrain from taking any action with respect to a taxpayer pursuant to— (i) Chapter 64 (relating to collection); (ii) Chapter 70, subchapter B (relating to bankruptcy and receiverships); (iii) Chapter 78 (relating to discovery of liability and enforcement of title); or (iv) Any other provision of the internal revenue laws specifically described by the NTA in the TAO. ............................................................................................ (3) Expedite, review, or reconsider an action at a higher level. Although the NTA may not make the substantive determination, a TAO may be issued to require the IRS to expedite, reconsider, or review at a higher level an action taken with respect to a determination or collection of a tax liability. .......................................................................................... (4) Examples. The following examples assume the existence of significant hardship: .......................................................................................... Example 1. J contacts a Local Taxpayer Advocate because a wage levy is causing financial difficulties. The NTA determines that the levy should be released as it is causing economic hardship (within the meaning of section 6343(a)(1)(D) and §301.6343-1(b)(4)). The NTA may issue a TAO ordering the IRS to release the levy in whole or in part by a specified date. ........................................................................................ Example 2. The IRS rejects K's offer in compromise. K files a Form 911, “Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order).” The NTA discovers facts that support acceptance of the offer in compromise. The NTA may issue a TAO ordering the IRS to reconsider its rejection of the offer or to review the rejection of the offer at a higher level. The TAO may include the NTA's analysis of and recommendation for resolving the case. ............................................................................................. Example 3. L files a protest requesting Appeals consideration of IRS's proposed denial of L's request for innocent spouse relief. Appeals advises L that it is going to issue a Final Determination denying the request for innocent spouse relief. L files a Form 911, “Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order).” The NTA reviews the administrative record and concludes that the facts support granting innocent spouse relief. The NTA may issue a TAO ordering Appeals to refrain from issuing a Final Determination and reconsider or review at a higher level its decision to deny innocent spouse relief. The TAO may include the NTA's analysis of and recommendation for resolving the case. .......................................................................................... (d) Issuance. A TAO may be issued to any office, operating division, or function of the IRS. A TAO shall apply to persons performing services under a qualified tax collection contract (as defined in section 6306(b)) to the same extent and in the same manner as the order applies to IRS employees. A TAO will not be issued to IRS Criminal Investigation division (CI), or any successor IRS division responsible for the criminal investigation function, if the action ordered in the TAO could reasonably be expected to impede a criminal investigation. CI will determine whether the action ordered in the TAO could reasonably be expected to impede an investigation. Generally, a TAO may not be issued to the Office of Chief Counsel. ***** (f) Effective/applicability date. These regulations are applicable for TAOs issued on or after [INSERT DATE OF PUBLICATION OF THIS DOCUMENT IN THE FEDERAL REGISTER], except that paragraph (e) of this section is applicable beginning March 20, 1992. Steven T. Miller Deputy Commissioner for Services and Enforcement. Approved: March 25, 2011 Michael Mundaca Assistant Secretary of the Treasury (Tax Policy). [FR Doc. 2011-7770 Filed 03/31/2011 at 8:45 am; Publication Date: 04/01/2011] Prop Reg § 301.7811-1. Taxpayer Assistance Orders. (a) Authority to issue. (1) In general. When an application for a Taxpayer Assistance Order (TAO) is filed by the taxpayer or the taxpayer's authorized representative in the form, manner and time specified in paragraph (b) of this section, the National Taxpayer Advocate (NTA) may issue a TAO if, in the determination of the NTA, the taxpayer is suffering or is about to suffer a significant hardship as a result of the manner in which the internal revenue laws are being administered by the Internal Revenue Service (IRS), including action or inaction on the part of the IRS. (2) The National Taxpayer Advocate defined. The term National Taxpayer Advocate includes any designee of the NTA, such as a Local Taxpayer Advocate. (3) Issuance without a written application. The NTA may issue a TAO in the absence of a written application by the taxpayer under section 7811(a). (4) Significant hardship. (i) Determination required. Before a TAO may be issued, the NTA is required to make a determination regarding significant hardship. (ii) Term Defined. The term significant hardship means a serious privation caused or about to be caused to the taxpayer as the result of the particular manner in which the revenue laws are being administered by the IRS. Significant hardship includes situations in which a system or procedure fails to operate as intended or fails to resolve the taxpayer's problem or dispute with the IRS. A significant hardship also includes, but is not limited to: (A) An immediate threat of adverse action; (B) A delay of more than 30 days in resolving taxpayer account problems; (C) The incurring by the taxpayer of significant costs (including fees for professional representation) if relief is not granted; or (D) Irreparable injury to, or a long-term adverse impact on, the taxpayer if relief is not granted. (iii) A delay of more than 30 days in resolving taxpayer account problems is further defined. A delay of more than 30 days in resolving taxpayer account problems exists under the following conditions: (A) When a taxpayer does not receive a response by the date promised by the IRS; or (B) When the IRS has established a normal processing time for taking an action and the taxpayer experiences a delay of more than 30 days beyond the normal processing time. (iv) Examples of significant hardship. The provisions of this section are illustrated by the following examples: Example (1). Immediate threat of adverse action. The IRS serves a levy on A's bank account. A needs the bank funds to pay for a medically necessary surgical procedure that is scheduled to take place in one week. If the levy is not released, A will lack the funds necessary to have the procedure. A is experiencing an immediate threat of adverse action. Example (2). Delay of more than 30 days. B files a Form 4506, “Request for a Copy of Tax Return.” B does not receive the photocopy of the tax return after waiting more than 30 days beyond the normal time for processing. B is experiencing a delay of more than 30 days. Example (3). Significant costs. The IRS sends XYZ, Inc. several notices requesting payment of the outstanding employment taxes owed by XYZ, Inc. and four of its subsidiaries. The IRS contends that XYZ, Inc. and the four subsidiaries have small employment tax balances with respect to 12 employment tax quarters totaling $10X. XYZ, Inc. provides documentation to the IRS which it contends shows that if all payments were applied to each entity correctly, there would be no balance due. The IRS requests additional records and documentation. Because there are 60 tax periods (12 quarters for each of the five entities) involved, to comply with this request XYZ, Inc. will need to hire an accountant, who estimates he will charge at least $5X to organize all the records and provide a detailed analysis of the how the payments should have been applied. XYZ, Inc. is facing significant costs. Example (4). Irreparable injury. D has arranged with a bank to refinance his mortgage to lower his monthly payment. D is unable to make the current monthly payment. Unless the monthly payment amount is lowered, D will lose his residence to foreclosure. The IRS refuses to subordinate the Federal tax lien, as permitted by IRC section 6325(d), or discharge the property subject to the lien, as permitted by IRC section 6325(b). As a result, the bank will not allow D to refinance. D is facing an irreparable injury if relief is not granted. (5) Distinction Between Significant Hardship and the Issuance of a TAO. A finding that a taxpayer is suffering or about to suffer a significant hardship as a result of the manner in which the internal revenue laws are being administered by the IRS will not automatically result in the issuance of a TAO. After making a determination of significant hardship, the NTA must determine whether the facts and the law support relief for the taxpayer. In cases where any IRS employee is not following applicable published administrative guidance (including the Internal Revenue Manual), the NTA shall construe the factors taken into account in determining whether to issue a TAO in the manner most favorable to the taxpayer. (b) Generally. A TAO is an order by the NTA to the IRS. The IRS will comply with a TAO unless it is appealed and then modified or rescinded by the NTA, Commissioner or the Deputy Commissioner. If a TAO is modified or rescinded by the Commissioner or Deputy Commissioner, a written explanation of the reasons for the modification or rescission must be provided to the NTA. The NTA may not make a substantive determination of any tax liability. A TAO is also not intended to be a substitute for an established administrative or judicial review procedure, but rather is intended to supplement existing procedures if a taxpayer is about to suffer or is suffering a significant hardship. A request for a TAO shall be made on a Form 911, “Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order)” (or other specified form) or in a written statement that provides sufficient information for TAS to determine the nature of the harm or the need for assistance. A taxpayer's right to administrative or judicial review will not be diminished or expanded in any way as a result of the taxpayer's seeking assistance from TAS. (c) Contents of Taxpayer Assistance Orders. After establishing that the taxpayer is facing significant hardship and determining that the facts and law support relief to the taxpayer, the NTA may issue a TAO ordering the IRS within a specified time to— (1) Release a Levy. Release levied property (to the extent that the IRS may by law release such property); or (2) Take Certain Other Actions. Cease any action, take any action as permitted by law, or refrain from taking any action with respect to a taxpayer pursuant to— (i) Chapter 64 (relating to collection); (ii) Chapter 70, subchapter B (relating to bankruptcy and receiverships); (iii) Chapter 78 (relating to discovery of liability and enforcement of title); or (iv) Any other provision of the internal revenue laws specifically described by the NTA in the TAO. (3) Expedite, Review or Reconsider an Action at a Higher Level. Although the NTA may not make the substantive determination, a TAO may be issued to require the IRS to expedite, reconsider, or review at a higher level an action taken with respect to a determination or collection of a tax liability. (4) Examples. The following examples assume the existence of significant hardship: Example (1). J contacts a local taxpayer advocate because a wage levy is causing financial difficulties. The NTA determines that the levy should be released as it is causing economic hardship (within the meaning of section 6343(a) and Treas. Reg. §301.6343-1(b)(4)). The NTA may issue a TAO ordering the IRS to release the levy in whole or in part by a specified date. Example (2). The IRS rejects K's offer in compromise. K files a Form 911, “Request for Taxpayer Advocate Service Assistance (and Application for Taxpayer Assistance Order).” The NTA discovers facts that support acceptance of the offer in compromise. The NTA may issue a TAO ordering the IRS to reconsider its rejection of the offer or to review the rejection of the offer at a higher level. The TAO may include NTA analysis of and recommendation for resolving the case. Example (3). L files a protest requesting Appeals consideration of IRS's proposed denial of L's request for innocent spouse relief. Appeals advises L that it is going to issue a Final Determination denying the request for innocent spouse relief. L files a Form 911, “Request for Taxpayer Advocate Service Assistance (and Application for Taxpayer Assistance Order).” The NTA reviews the administrative record and concludes that the facts support granting innocent spouse relief. The NTA may issue a TAO ordering Appeals to refrain from issuing a Final Determination and reconsider or review at a higher level its decision to deny innocent spouse relief. The TAO may include TAS analysis of and recommendation for resolving the case. (d) Issuance. A TAO may be issued to any office, operating division, or function of the IRS. A TAO shall apply to persons performing services under a qualified tax collection contract (as defined in section 6306(b)) to the same extent and in the same manner as the order applies to IRS employees. A TAO will not be issued to IRS Criminal Investigation division (CI), or any successor IRS division responsible for the criminal investigation function, if the action ordered in the TAO could reasonably be expected to impede a criminal investigation. CI will determine whether the action ordered in the TAO could reasonably be expected to impede an investigation. Generally, a TAO may not be issued to the Office of Chief Counsel. ***** (f) Effective applicability date. These regulations are applicable for TAOs issued on or after the date of publication of the Treasury decision adopting these rules as final regulations in the Federal Register, except that paragraph (e) is applicable beginning March 20, 1992. § 7811 Taxpayer Assistance Orders. ________________________________________ (a) New Law Analysis Authority to issue. (1) In general. Upon application filed by a taxpayer with the Office of the Taxpayer Advocate (in such form, manner, and at such time as the Secretary shall by regulations prescribe), the National Taxpayer Advocate may issue a Taxpayer Assistance Order if— (A) The National Taxpayer Advocate determines the taxpayer is suffering or about to suffer a significant hardship as a result of the manner in which the internal revenue laws are being administered by the Secretary; or (B) New Law Analysis the Taxpayer meets such other requirements as are set forth in regulations prescribed by the Secretary. (2) Determination of hardship. For purposes of paragraph (1) , a significant hardship shall include— (A) an immediate threat of adverse action; (B) a delay of more than 30 days in resolving taxpayer account problems; (C) the incurring by the taxpayer of significant costs (including fees for professional representation) if relief is not granted; or (D) irreparable injury to, or a long-term adverse impact on, the taxpayer if relief is not granted. (3) Standard where administrative guidance not followed. In cases where any Internal Revenue Service employee is not following applicable published administrative guidance (including the Internal Revenue Manual), the National Taxpayer Advocate shall construe the factors taken into account in determining whether to issue a Taxpayer Assistance Order in the manner most favorable to the taxpayer. (b) Terms of a Taxpayer Assistance Order. The terms of a Taxpayer Assistance Order may require the Secretary within a specified time period — (1) to release property of the taxpayer levied upon, or (2) to cease any action, take any action as permitted by law, or refrain from taking any action, with respect to the taxpayer under— (A) chapter 64 (relating to collection), (B) subchapter B of chapter 70 (relating to bankruptcy and receiverships), (C) chapter 78 (relating to discovery of liability and enforcement of title), or (D) any other provision of law which is specifically described by the National Taxpayer Advocate in such order. (c) Authority to modify or rescind. Any Taxpayer Assistance Order issued by the National Taxpayer Advocate under this section may be modified or rescinded— (1) only by the National Taxpayer Advocate, the Commissioner of Internal Revenue, or the Deputy Commissioner of Internal Revenue, and (2) only if a written explanation of the reasons for the modification or rescission is provided to the National Taxpayer Advocate. (d) Suspension of running of period of limitation. The running of any period of limitation with respect to any action described in subsection (b) shall be suspended for— (1) the period beginning on the date of the taxpayer's application under subsection (a) and ending on the date of the National Taxpayer Advocate's decision with respect to such application, and (2) any period specified by the National Taxpayer Advocate in a Taxpayer Assistance Order issued pursuant to such application. (e) Independent action of National Taxpayer Advocate. Nothing in this section shall prevent the National Taxpayer Advocate from taking any action in the absence of an application under subsection (a) . (f) National Taxpayer Advocate. For purposes of this section , the term “National Taxpayer Advocate” includes any designee of the National Taxpayer Advocate. (g) New Law AnalysisWG&L Treatises Application to persons performing services under a qualified tax collection contract. Any order issued or action taken by the National Taxpayer Advocate pursuant to this section shall apply to persons performing services under a qualified tax collection contract (as defined in section 6306(b) ) to the same extent and in the same manner as such order or action applies to the Secretary. www.irstaxattorney.com 888-712-7690