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Part 9. Criminal Investigation

Chapter 5. Investigate Process

Section 11. Other Investigations (Cont. 1)

9.5.11  Other Investigations (Cont. 1)

9.5.11.6 
Excise Tax

9.5.11.6.2  (09-09-2004)
Excise Tax Categories

  1. The excise tax categories of interest to CI include:

    1. Manufacturers excise taxes:
      automotive and related items (gasoline, gasohol sales, gasoline sales used for gasohol, and tires)
      coal from underground and surface mines, and
      recreational equipment such as firearms (pistols, revolvers, other firearms, shells and cartridges) and sporting goods (fishing equipment, bows, arrows and related equipment)

    2. Occupational taxes:
      wagering
      brewers
      retail liquor dealers
      retail dealers in beer
      wholesale dealers in beer
      limited retail dealers

    3. Facilities and services:
      communications (local and toll telephone service and teletypewriter service)
      transportation (transportation of persons by air, inland waterways users fuel, and transportation of property)

    4. Heavy truck and trailer retailer taxes:
      truck parts and accessories installations
      truck chassis or body
      truck trailer
      semitrailer chassis or body

    5. Miscellaneous excise taxes:
      seabed mining
      environmental taxes
      highway motor vehicle use tax
      foreign insurance policies
      wagering taxes
      liquor taxes
      tobacco taxes

  2. Excise taxes on alcohol, tobacco, and firearms are not under the jurisdiction of IRS. Those items are taxed under Subtitle E of Title 26. Responsibility for the enforcement of excise taxes on alcohol, tobacco, machine guns, and certain other firearms is vested exclusively with the Department of Justice (DOJ), Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).

9.5.11.6.3  (09-09-2004)
Excise Tax Investigations

  1. Excise tax returns, unlike those for income taxes, do not lend themselves to analysis to determine the possible existence of tax violations. The information contained in quarterly excise tax returns on Form 720, Quarterly Federal Excise Tax Return, is limited to the kind of tax, the gross tax, the credit for overpaid tax in prior returns, and the net tax due.

  2. Excise tax investigations related to false or fraudulent returns usually result from referrals following field audits of taxpayers’ books and records. As violations applicable to excise taxes often occur simultaneously with income tax offenses, field audits conducted by the operating division in income tax matters often disclose violations with respect to excise taxes.

  3. Referrals in such investigations often relate to both excise and income tax violations. Investigations of offenses involving willful failure to file excise tax returns, or willful failure to collect and pay over excise taxes, are usually based upon referrals from the civil operating divisions.

  4. Excise tax violations are also disclosed through surveys conducted by CI and from information obtained by special agents during their investigation of income tax offenses. As most excise tax offenses are committed in conjunction with income tax violations, investigation of both types of violations usually arise from the same sources.

9.5.11.6.4  (09-09-2004)
Techniques of Excise and Income Tax Investigations Compared

  1. Although the criminal penalties for most excise tax violations are imposed by the same Title 26 sections that relate to income taxes, the nature of the evidence needed to sustain prosecution of excise tax violations differs in many respects from that required in income tax investigations.

  2. Excise tax is based on specifically enumerated articles or services, whereas income tax is based strictly on income.

  3. For this reason, the established methods for determining income in income tax investigations may be inadequate to sustain a criminal prosecution for evasion of the excise tax on specifically enumerated articles or services.

  4. Under certain circumstances the specific item method of proving income may be effectively used in excise tax investigations, especially if adequate records are maintained by the taxpayer.

  5. Any other method of proving income may be used if the circumstances are such that the evidence developed will serve to establish or buttress proof of a violation of the excise tax on the specifically enumerated articles or services involved.

  6. In general, the investigative techniques applicable to income tax investigations may be used in excise tax investigations.

9.5.11.6.5  (09-09-2004)
Jeopardy Assessment in Excise Tax investigations

  1. Title 26 USC §6862 provides that if the Secretary believes the collection of any tax (other than income tax, estate tax, gift tax, and the excise taxes imposed by Chapters 41, 42, 43, and 44) under any provision of the Internal Revenue laws will be jeopardized by delay, he/she should, whether or not the time otherwise prescribed by law for making a return and paying such tax has expired, immediately assess such tax.

9.5.11.6.6  (09-09-2004)
Criminal Penalties for Excise Tax Violations

  1. Criminal penalties for most violations of excise taxes are imposed by the same USC sections that relate to income taxes and cover offenses such as:

    1. willful failure to file a return, pay tax, supply information, or keep records

    2. willful failure to account for, collect, and pay over a particular tax

    3. willful attempts to defeat the tax in any manner

  2. The USC also provides specific penalties that are only applicable to the various excise taxes. (The various criminal penalties are enumerated in IRM 9.1.3, Criminal Statutory Provisions and Common Law.) For example, 26 USC §7215 and 26 USC §7512, relate to offenses involving collected taxes and cover noncompliance with an official notice to collect and deposit "trust fund" taxes.

9.5.11.7  (09-09-2004)
Collateral Investigations

  1. A request for collateral investigation from one CI field office to another should be specific as to the information and data needed and should include a statement of all facts and background information considered necessary or useful in making the desired inquiries.

  2. In determining whether or not to request a collateral investigation, consideration should be given to the feasibility of communicating essential background information, as well as to the scope of the inquiries that must be made. If knowledge of a complex set of circumstances is a prerequisite or if extensive inquiries must be made, the dispatching of a special agent is generally preferable to requesting a collateral investigation.

  3. A request for a collateral investigation will be addressed to the SAC of the field office where the desired information is thought to be available. The request will bear the originating special agent’s signature, telephone number, and the signature of the SSA of the originating field office authorized to approve such requests.

  4. A collateral investigation can be made either electronically (e-mail) or by conventional mail or express mail services. In all instances, the request will be submitted through the SSA.

  5. Whether electronically or by a mail or express service, the request should include the mailing address to be used by the responding office. If the requesting field office wants the response to go directly to a post of duty, the following format at the conclusion of the request is suggested:

    • (Signature of originating special agent)

    • (Originating special agents’ phone number)

    • Approved:

    • (Signature)

    • (Title)

    • Mail Reply To:

    • (Name)

    • (P.O. Box or street and number)

    • (City, State, Zip Code)

  6. A reply to a request for collateral investigation will be addressed to the SAC of the field office that made the request. It should bear the signature and the telephone number of the special agent who made the collateral investigation. The reply and any accompanying exhibits or schedules will be mailed (or express serviced, if appropriate) to the SAC of the requesting field office. If all or part of the response can be made electronically (e-mail), the responding field office should include the pertinent information in the electronic transmission with electronic copies to the respective officials.

  7. A request for a collateral investigation should be complied with expeditiously, within 30 calendar days if possible. The requesting office should be promptly notified in any instance in which it becomes apparent that the request cannot be complied with within 60 calendar days after receipt.

  8. If a collateral investigation relates to one or more investigation(s), the investigation number or numbers must be shown in the request for the collateral investigation, as well as in the reply.

  9. The names of individuals, corporations, partnerships, and other business or taxable entities will be typed in capital letters whenever used in requests for a collateral investigation, replies thereto, and related correspondence.

  10. When requesting a collateral investigation, the official of the initiating or requesting field office with authority to obligate funds for the payment of the collateral summons will do so at the estimated payment level. (See IRM 25.5, Summons Handbook.) The transmittal letter accompanying the summons should indicate the authority level of obligation of the approving official.

  11. The requesting field office will forward a completed Form 2039, Summons, with all information provided except for the time and place for appearance and the official before whom the witness is to appear. The requesting field office, as appropriate, will also forward an envelope(s) addressed to the last known address(es) of any noticee(s).

  12. In the event the replying field office believes the Form 2039 to be incomplete, they should communicate this information to the requesting field office. With concurrence, the replying field office may prepare a revised Form 2039 or the requesting field office may prepare and forward another Form 2039, as appropriate. In the event the replying field office prepares a revised Form 2039, that field office should observe the authority level of obligation as stated in the transmittal letter unless otherwise authorized by the requesting field office.

  13. If the official of the receiving field office determines prior to third-party compliance with the summons that the anticipated costs will exceed the obligated amount for which the approving official has authority, he/she will advise the requesting field office of the need for an approval from an official with higher obligation authority.

  14. When the official of the field office serving the summons in coordination with the issuing official of the requesting field office determines the summons has been satisfactorily complied with, the summonsed documents will be submitted to the requesting field office along with the original summons. A copy of the summons will be retained by the replying field office.

  15. Third parties who are summonsed will submit bills through the serving official to the official in the requesting field office who originally authorized the summons. If the actual bill exceeds the obligating authority of the approving official, it will be that official’ s responsibility to obtain subsequent approval at the required level.

  16. The issuing official will review the bill for accuracy and reasonableness and then certify the bill for payment. (See IRM 25.5, Summons Handbook.) The bill will then be forwarded to the field office budget officer for payment processing.

  17. For additional information concerning summonses issued in connection with collateral investigations, see IRM 25.5, Summons.

  18. See IRM 9.5.2, Grand Jury Investigations, with regard to collateral investigations in grand jury investigations.

9.5.11.8  (09-09-2004)
Probation Revocation Investigations

  1. When information is received from the other operating divisions, the attorney for the government, the US Probation officer, or other sources, that the former subject of a criminal investigation is not in compliance with the conditions of his/her probation, CI may initiate a probation revocation investigation.

  2. The SAC will review the information and, if warranted, authorize the reopening of the former primary (PI) and subject investigation (SCI). All requests to reopen the former PI and SCI must be forwarded through Headquarters (HQ).

  3. If the investigation results in a recommendation to revoke the subject’s probation, the special agent will prepare a report to be forwarded to the SAC through the SSA.

  4. If the SAC concurs with the recommendation, he/she will make a direct referral to the attorney for the government.

9.5.11.9  (09-09-2004)
Voluntary Disclosure Practice

  1. It is currently the practice of the IRS that a voluntary disclosure will be considered along with all other factors in the investigation in determining whether criminal prosecution will be recommended. This voluntary disclosure practice creates no substantive or procedural rights for taxpayers as it is simply a matter of internal IRS practice, provided solely for guidance to IRS personnel. Taxpayers cannot rely on the fact that other similarly situated taxpayers may not have been recommended for criminal prosecution.

  2. A voluntary disclosure will not automatically guarantee immunity from prosecution; however, a voluntary disclosure may result in prosecution not being recommended. This practice does not apply to taxpayers with illegal source income.

  3. A voluntary disclosure occurs when the communication is truthful, timely, complete, and when:

    1. A taxpayer shows a willingness to cooperate (and does in fact cooperate) with the IRS in determining his/her correct tax liability.

    2. The taxpayer makes good faith arrangements with the IRS to pay in full, the tax, interest, and any penalties determined by the IRS to be applicable.

  4. A disclosure is timely if it is received before:

    1. The IRS has initiated a civil examination or criminal investigation of the taxpayer, or has notified the taxpayer that it intends to commence such an examination or investigation.

    2. The IRS has received information from a third party (e.g., informant, other governmental agency, or the media) alerting the IRS to the specific taxpayer’s noncompliance.

    3. The IRS has initiated a civil examination or criminal investigation which is directly related to the specific liability of the taxpayer.

    4. The IRS has acquired information directly related to the specific liability of the taxpayer from a criminal enforcement action (e.g., search warrant, grand jury subpoena).

  5. Special agents are encouraged to consult their Criminal Tax (CT) Counsel attorney on voluntary disclosure issues.

  6. Examples of voluntary disclosures include:

    1. A letter from an attorney which encloses amended returns from a client which are complete and accurate (reporting legal source income omitted from the original returns), which offers to pay the tax, interest, and any penalties determined by the IRS to be applicable in full and which meets the timeliness standard set forth above. This is a voluntary disclosure because all of the elements set forth in (3) above, have been met.

    2. A disclosure made by a taxpayer of omitted income facilitated through a barter exchange after the IRS has announced that it has begun a civil compliance project targeting barter exchanges but before it has commenced an examination or investigation of the taxpayer or notified the taxpayer of its intention to do so. In addition, the taxpayer files complete and accurate amended returns and makes arrangements with the IRS to pay in full, the tax, interest, and any penalties determined by the IRS to be applicable. This is a voluntary disclosure because the civil compliance project involving barter exchanges does not yet directly relate to the specific liability of the taxpayer and because all of the elements set forth in (3), above have been met.

    3. A disclosure made by a taxpayer of omitted income facilitated through a widely promoted scheme that is the subject of an IRS civil compliance project. Although the IRS already obtained information which might lead to an examination of the taxpayer, it not yet commenced any such examination or investigation or notified the taxpayer of its intent to do so. In addition, the taxpayer files complete and accurate returns and makes arrangements with the IRS to pay in full, the tax, interest, and any penalties determined by the IRS to be applicable. This is a voluntary disclosure because the civil compliance project involving the scheme does not yet directly relate to the specific liability of the taxpayer and because all of the elements set forth in (3), above have been met.

    4. A disclosure made by an individual who has not filed tax returns after the individual has received a notice stating that the IRS has no record of receiving a return for a particular year and inquiring into whether the taxpayer filed a return for that year. The individual files complete and accurate returns and makes arrangements with the IRS to pay, in full, the tax, interest, and any penalties determined by the IRS to be applicable . This is a voluntary disclosure because the IRS has not yet commenced an examination or investigation of the taxpayer or notified the taxpayer of its intent to do so and because all of the elements set forth in (3), above have been met.

  7. Examples of what are not voluntary disclosures include:

    1. A letter from an attorney stating his/her client, who wishes to remain anonymous, wants to resolve his/her tax liability. This is not a voluntary disclosure until the identity of the taxpayer is disclosed and all of the elements of (3) above have been met.

    2. A disclosure made by a taxpayer who is under grand jury investigation. This is not a voluntary disclosure because the taxpayer is already under criminal investigation. The conclusion would be the same whether or not the taxpayer knew of the grand jury investigation.

    3. A disclosure made by a taxpayer, who is not currently under examination or investigation, of omitted gross receipts from a partnership, whose partner is already under investigation for omitted income that was skimmed from the partnership. This is not a voluntary disclosure because the IRS has already initiated an investigation which is directly related to the specific liability of this taxpayer. The conclusion would be the same whether or not the taxpayer knew of the ongoing investigation.

    4. A disclosure made by a taxpayer, who is not currently under examination or investigation, of omitted constructive dividends received from a corporation which is currently under examination. This is not a voluntary disclosure because the IRS has already initiated an examination which is directly related to the specific liability of this taxpayer. The conclusion would be the same whether or not the taxpayer knew of the ongoing examination.

    5. A disclosure made by a taxpayer after an employee has contacted the IRS regarding the taxpayer’s double set of books. This is not a voluntary disclosure even if no examination or investigation has commenced because the IRS has already been informed by the third party of the specific taxpayer’s noncompliance. The conclusion would be the same whether or not the taxpayer knew of the informant ’s contact with the IRS.

  8. Pattern Letter 2527(P), is a letter that may be used to respond to a situation where a taxpayer’s representative forwards a letter with payment from an anonymous taxpayer. See Document Manager for Pattern Letter 2527(P).

9.5.11.9.1  (09-09-2004)
Voluntary Disclosure Protocols

  1. All voluntary disclosures must meet the requirements contained in subsection 9.5.11.9 above. The voluntary disclosure practice does not specify any particular format for voluntary disclosure communications so long as these requirements are met. The taxpayer or their representative may provide information either verbally or in writing.

  2. Whether or not a communication is a voluntary disclosure can only be determined by examining the facts and circumstances of each investigation. When responding to inquiries, employees will refrain from offering opinions or discussing hypothetical investigations with anonymous taxpayers or their representatives.

9.5.11.9.2  (09-09-2004)
All Employees

  1. In responding to inquiries concerning the IRS voluntary disclosure practices, all IRS employees will refer to subsection 9.5.11.9, above.

  2. Employees will provide the taxpayer with their title, name, employee ID number and telephone number.

  3. Employees may provide taxpayers with a copy of the voluntary disclosure practice (see subsection 9.5.11.9, above).

  4. If the taxpayer requests further information they will be referred to the CI field office covering the geographic area where the taxpayer resides.

9.5.11.9.3  (09-09-2004)
Designated Criminal Investigation Employees

  1. The SAC should ensure that special agents handling voluntary disclosures are thoroughly familiar with the voluntary disclosure practice. (see subsection 9.5.11.9, above)

  2. Whether a communication is a voluntary disclosure can only be determined by examining the facts and circumstances of each investigation.

  3. Upon assignment, the special agent will number a primary investigation (PI) (see IRM 9.9, Criminal Investigation Management Investigation System). Numbering voluntary disclosures as a PI will discourage ineligible taxpayers or taxpayers attempting to game the system by "shopping" field offices in an attempt to obtain more favorable treatment. This process will assist CI in tracking voluntary disclosure applications and results.

9.5.11.9.4  (09-09-2004)
Responding to Taxpayer Inquiries

  1. Special agents will provide the taxpayer and/or their representative with their title, name, employee ID number (not badge or commission number) and telephone number.

  2. In addition to providing general information about the voluntary disclosure practice, special agents may discuss scenarios with taxpayers or their representatives to potentially ascertain if certain fact patterns might meet voluntary disclosure practice criteria. However, taxpayer representatives must file a valid power of attorney before discussing the specifics of their taxpayer’ s investigation.

  3. Special agents may provide taxpayers with a copy of the voluntary disclosure practice (see subsection 9.5.11.9, above).

  4. Special agents may discuss the voluntary disclosure practice and what constitutes a timely disclosure. Special agents should cite the timeliness criteria contained in the IRM and refer to the specific examples provided.

  5. Special agents will inform all taxpayers that the voluntary disclosure practice does not apply to taxpayers with illegal source income .

  6. Special agents should emphasize a voluntary disclosure only occurs when the communication is truthful, timely, complete, and when:

    1. The taxpayer shows a willingness to cooperate (and does in fact cooperate) with the IRS in determining his/her correct tax liability.

    2. The taxpayer makes good faith arrangements with the IRS to pay in full, the tax, interest, and any penalties determined by the IRS to be applicable.

  7. Special agents will inform the taxpayer that a voluntary disclosure will not automatically guarantee immunity from prosecution. However, a voluntary disclosure may result in prosecution not being recommended.

  8. Special agents will inform the taxpayers or their representative that a subsequent determination that the taxpayer has not fully cooperated or provided materially false information may result in the matter being referred for criminal investigation and/or the imposition of civil sanctions.

  9. Special agents should ensure all taxpayers are provided with the name of a contact person and call back number.

9.5.11.9.5  (09-09-2004)
Disqualifying Factors

  1. If a taxpayer expresses an interest in making a voluntary disclosure, he/she must be asked the following questions to determine if potential disqualifying factors exist:

    1. Are you currently the subject of a criminal investigation or civil examination? (If yes, specify)

    2. Has the IRS notified you that it intends to commence an examination or investigation? (If yes, specify)

    3. Are you under investigation by any law enforcement agency? (If yes, specify)

    4. Is the source of any of your income from illegal activity? (The IRS voluntary disclosure practice does not apply to taxpayers with illegal source income.) (If yes, specify)

    5. Do you have any reason to believe that the IRS has obtained information concerning your tax liability? (If yes, specify)

      Note:

      If the taxpayer responds yes to any of the above questions, the facts and circumstances of each investigation must be clarified to determine if it is a disqualifying factor.

  2. If there are no disqualifying factors the taxpayer may make a voluntary disclosure.

9.5.11.9.6  (09-09-2004)
Voluntary Disclosure Communications

  1. Field offices may adopt local procedure that facilitate voluntary disclosure communications. To assess a voluntary disclosure, it is best to meet with the taxpayer and/or their representative. It is desirable that the SAC, Assistant Special Agent in Charge (ASAC) or Supervisory Special Agent (SSA) chair this meeting. Other attendees might include representatives from the other operating divisions, CT Counsel, and/or any other interested parties.

  2. The following taxpayer identifying information should be considered in ascertaining the completeness of the disclosure communication:

    1. Taxpayer identifying information (including spouse)
      • name(s)
      • social security number(s)
      • address(es)

  3. If a business entity is involved provide the business name, address, and employer identification number, if available.

  4. Provide information on the tax periods:

    1. Type(s) of return(s) (Form 1040, 1120, 941 etc.)

    2. Type of tax(es) involved (income, employment, excise, etc.)

  5. The communication must include a brief description of all omitted income, the tax scheme used by the taxpayer, and a dollar estimate of the total taxes owed.

  6. A statement must be made by the taxpayer (either verbally or in writing) that he/she is willing to cooperate with the IRS in determining the correct tax liability and make good faith arrangements to pay in full, the tax, interest, and any penalties determined by the IRS to be applicable in full. This is critical.

  7. The taxpayer can prepare amended returns for submission with their voluntary disclosure communication or wait to submit amended returns until after CI evaluates their communication and makes a recommendation to SB/SE Planning and Special Programs (PSP) Area Manager.

  8. To better assess timeliness, the taxpayer should be asked to provide the reason(s) why they are making this disclosure.

  9. Additional information may be required to assess the completeness, timeliness and truthfulness of the taxpayer’s communication.

9.5.11.9.7  (09-09-2004)
Evaluating the Disclosure

  1. Special agents will evaluate disclosures to determine if the information provided is truthful and complete, and shall make a recommendation to the SAC, as to whether or not the taxpayer has met all voluntary disclosure practice criteria.

  2. The evaluation should be completed as expeditiously as possible, ideally within 10 working days or less from the date the complete voluntary disclosure communication from the taxpayer has been received. The SAC should be apprised if an evaluation cannot be completed within 30 days.

  3. As part of the evaluation process special agents will query the following databases:

    1. The Criminal Investigation Management Information System (CIMIS)

    2. Integrated Data Retrieval System (IDRS)

    3. The Currency and Banking Retrieval System (CBRS) Database

    4. The National Crime Information Center Database (NCIC)

  4. If the indices checks (or any other evaluative steps) disclose potentially disqualifying information the taxpayer should be contacted and offered an opportunity to provide an explanation.

  5. If a satisfactory explanation cannot be provided, this may constitute a disqualifying factor.

  6. If the indices checks disclose no disqualifying information, the voluntary disclosure will be referred to the SAC, with a recommendation that the matter be forwarded to SB/SE.

9.5.11.9.8  (09-09-2004)
Transmitting the Voluntary Disclosure to SB/SE

  1. If the SAC, concurs with the special agent’s recommendation that the voluntary disclosure(s) meets all IRS criteria, a transmittal memorandum will be forwarded to PSP for further action. A list of all PSP offices can be found on SB/SE’s PSP webpage. See Document Manager for the Voluntary Disclosure Transmittal Memorandum.

  2. Planning and Special Programs will contact the taxpayer regarding further action in the voluntary disclosure process, a copy of the transmittal memorandum will not be sent to the taxpayer and/or their representative.

  3. All relevant information received by CI regarding a voluntary disclosure will accompany the transmittal memorandum. The transmittal memorandum will be sent to PSP (or other designated operating unit).

    Note:

    " Restricted for Law Enforcement Use Only" indicates checks or information will not be transmitted to PSP. This information will be maintained in the CI investigation file .

  4. If PSP later determines that the taxpayer has not cooperated fully or provided materially false information the matter will be referred back to CI for further evaluation and possible criminal investigation via the fraud referral process.

9.5.11.9.9  (09-09-2004)
Negative Evaluations

  1. If the SAC determines that a disclosure does not meet all IRS voluntary disclosure criteria, a letter will be sent to the taxpayer informing them of the reason(s) he/she is ineligible to participate in the IRS’s voluntary disclosure practice. It is not necessary to cite specific reasons for the rejection if it would compromise an ongoing investigative matter.

  2. Criminal investigation will evaluate the criminal potential of all negative evaluations. If the matter is not acceptable for investigation, it will be forwarded to PSP for whatever action they deem appropriate.

9.5.11.9.10  (09-09-2004)
Record Keeping

  1. The SAC, will maintain a complete copy of accepted and rejected voluntary disclosures.

    Note:

    API is to be numbered for each voluntary disclosure assignment. This will assist CI in tracking voluntary disclosure applications and results, and will discourage taxpayers from "shopping" offices for favorable treatment.

9.5.11.10  (09-09-2004)
Armed Escort Assignment

  1. To minimize the effect of forceful attempts to obstruct the administration of the Internal Revenue laws and related offenses, special agents may be assigned as armed escorts to ensure the physical safety of:

    1. employees and their families

    2. informants

    3. witnesses and their families or close associates

  2. Criminal Investigation (CI) has primary responsibility for providing armed escorts for IRS personnel.

  3. Whenever any IRS employee receives information indicating possible danger to anyone whom the IRS has the authority to protect, he/she should inform their immediate supervisor. The appropriate CI management official will consider providing protection during regular and off-duty hours to the extent that is necessary and appropriate. Consideration for providing protection will be given only when the potential danger is IRS-related.

  4. When an actual threat or assault has been made, Treasury Inspector General for Tax Administration (TIGTA) has primary jurisdiction and must be contacted. See subsection 9.5.11.3.2, above.

9.5.11.10.1  (09-09-2004)
Inspector General Request for Armed Escorts

  1. Requests for armed escorts for IRS personnel may be received from the TIGTA’s Special Agent in Charge - Field Division and from managers of other operating divisions.

  2. If the request involves an investigation where TIGTA has primary jurisdiction, CI may be requested to conduct the armed escort. The TIGTA special agents may accompany CI on the escort.

  3. The SAC will give immediate attention to these requests and will assign special agents to this duty. The SAC may also work out plans for continued escort duty, if appropriate, to avoid the necessity of recurring formal requests; for example, to furnish armed escorts to IRS personnel transporting receipts to government depositories on a regular basis.

9.5.11.10.2  (09-09-2004)
Armed Guard Assignment

  1. The IRM 1.16.9, Physical Security Program-Occupant Emergency Plan, contains IRS requirements and responsibilities for developing occupant emergency plans for offices and facilities occupied by the IRS in accordance with Federal Property Management Regulations 101–20.5.

  2. Special agents may be assigned as armed guards to protect government property in emergency situations where normal safeguards are not available. This might include guarding unusually large amounts of currency receipts prior to deposit, guarding against forcible rescue of seized property, or other guard details resulting from catastrophic situations.

9.5.11.10.3  (09-09-2004)
Armed Escort Requests by the IRS

  1. Criminal Investigation is responsible for the planning and the conduct of IRS personnel in armed escort assignments requested by other operating divisions. The request must be in writing and received by the SAC at least 10 business days prior to the date the armed escort is needed. This is to ensure that special agents have time to prepare a plan of action and to ensure the safety of all individuals involved.

  2. To expedite all requests, a copy of the armed escort request forwarded to the SAC should also be forwarded to the appropriate SSA.

  3. In the event an armed escort will occur within the 10 day notification period (emergency), the requesting supervisor will call the appropriate SSA and request the armed escort. The telephone request will be followed with the written request to the SAC and a copy to the SSA. The written request will note the date armed escort was orally discussed and the SSA with whom it was discussed.

  4. Upon assignment, the special agent will number the armed escort as a primary investigation (PI). (See IRM 9.9, Criminal Investigation Management Investigation System). Numbering armed escorts as PIs will enable CI to gather information about each escort, i.e., the taxpayer(s) involved, the time expended on each escort, and geographic information that could be critical to any future trend analysis.

    Note:

    A PI is to be numbered for each armed escort assignment. If an armed escort is completed and a subsequent request is received regarding the same subject, a new PI is to be numbered.

9.5.11.10.3.1  (09-09-2004)
Armed Escort Assignment

  1. When special agents receive an armed escort assignment, they should meet with the appropriate personnel to discuss the facts of the request.

  2. When a threat of bodily harm is anticipated, the following security precautions must be considered:

    1. Integrated Data Retrieval System (IDRS) file check for a Potentially Dangerous Taxpayer (PDT) code

    2. criminal records check

    3. registered weapons check

    4. local uniformed police assistance

    5. special weapons and protective clothing needs

    6. medical service availability

    7. prisoner transportation needs

    8. property protection needs

    9. Treasury Enforcement Communication System (TECS) checks for other agency assault investigations, fugitive status, etc.

      Note:

      The National Crime Information Center (NCIC), State and Local Criminal History Files, are available through the Interstate Identification Index (III) (Criminal History Files). These files may be used only in the administration of criminal justice. Therefore, this information cannot be disseminated to other IRS operating divisions.

  3. If the IDRS file check shows a PDT code, special agents should notify the requesting operating division personnel and take appropriate precautions.

9.5.11.10.3.2  (09-09-2004)
Understanding Role

  1. Representatives from both functions should become familiar with applicable procedures and responsibilities so that, during the armed escort, each representative understands his/her role.

  2. When special agents accompany IRS personnel who are attempting to make a seizure of personal property for payment of delinquent taxes, the special agents must bear in mind that the seizure must be accomplished without the use of force.

  3. The primary function of special agents in these assignments is to protect the IRS personnel in the performance of their duties.

9.5.11.10.3.3  (09-09-2004)
Resistance Encountered

  1. If resistance is encountered, the special agents involved should instruct the IRS personnel to stop the seizure activity. All IRS personnel should return to their offices and report the matter to their respective supervisors.

  2. When an assault or threat occurs in the course of a CI armed escort assignment, the special agents will take appropriate enforcement action, which may include placing the attacker under arrest. (See IRM 9.5.11.3, above.)

  3. In instances where an assault or threat occurred during an enforcement action, CI will promptly notify TIGTA and provide documentation concerning the incident and action taken. The Treasury Inspector General for Tax Administration will determine what investigation by TIGTA is warranted and will initiate appropriate processing of Potentially Dangerous Taxpayer (PDT).

  4. During an enforcement action where resistance is encountered, the SAC will review all the facts surrounding the incident and, if circumstances dictate, will consult with CT Counsel regarding obtaining appropriate warrants. (See IRM 9.4.12, Arrests). The SAC will keep the Director, Field Operations, informed as to these matters.

9.5.11.10.3.4  (09-09-2004)
Threat

  1. If, during the course of the armed escort, a threat, but not a physical attack, is made against IRS personnel or the accompanying special agents, the special agents and IRS personnel should leave and immediately report the matter to TIGTA and their respective supervisors.

  2. After a threat has been made and reported, TIGTA may accompany CI on an escort.

9.5.11.10.3.5  (09-09-2004)
Physical Attack

  1. If, during the course of the armed escort, a physical attack is made upon the IRS personnel or the accompanying special agents, the special agents have the authority to place the attacker under arrest for the crime committed in the agents’ presence. (See IRM 9.4.12, Arrests.)

  2. The safety of all IRS personnel involved should be considered before the arrest is made.

  3. Since the attacker will meet the criteria for inclusion in the PDT System, the special agents involved must report this incident to TIGTA within three business days.

  4. Procedures regarding rescue of seized property are found in IRM 9.4.12, Arrests.

9.5.11.11  (09-09-2004)
Protection and Maintenance of Informants and Witnesses

  1. Federal agencies have always recognized a duty to protect informants and witnesses from threats or possible danger resulting from their assistance to the government by furnishing information or by testifying on behalf of the government in criminal prosecutions.

  2. The Department of Justice Witness Security Program was established pursuant to Title V of the Organized Crime Control Act and the Witness Security Reform Act. Title V grants the Attorney General broad discretionary authority and appropriations to provide for the protection of actual and potential government witnesses in legal proceedings against any person alleged to have participated in an organized criminal activity or other serious offense.

  3. The Comptroller General of the United States ruled IRS has the authority to use its appropriations for temporary protection of an informant/witness or a witness until a determination by the Department of Justice (DOJ) is made that the person qualifies for Title V protection under it’s Witness Security Program.

  4. The IRS also has authority to approve all confidential expenditures for other protective arrangements undertaken by the IRS for an informant/witness or a witness who does not qualify for or is refused protection under the DOJ Witness Security Program, in an investigation which is not under the jurisdiction of the US Attorney’s Office.

  5. The existence of the Title V appropriation precludes the use of a more general appropriation such as that under which the IRS receives operating funds.

  6. Special Investigative Techniques, (CI:OPS:SIT) oversees the responsibilities of the Criminal Investigation Witness Security Coordinator (WSC). In this capacity, SIT coordinates all IRS protective arrangements and relocations, as the central contact point for field, DOJ, and HQ functions.

  7. Treasury Directive 55–01, Victims and Witness Assistance, dated January 9, 1999, provides policy and guidelines to be followed by Treasury Law Enforcement personnel in responding to the needs of crime victims and witnesses. The guidelines seek to ensure all victims and witnesses receive the assistance and protection to which they are entitled under the law. For further information see subsection 9.5.11.11.10, below and Treasury Directive 55–01, Victims and Witness Assistance, at www.ustreas.gov/regs/.

9.5.11.11.1  (09-09-2004)
Definitions

  1. For the purpose of these guidelines and procedures on protection, the following terms are defined:

    1. Witness—Any person who has testified in a judicial proceeding or any person who will clearly become a witness before a Federal grand jury or at a trial. When it is not clear that a person will be used as a witness, he/she will have the same status as an informant.

    2. Informant—Any person who supplies the IRS with information regarding violations of the tax laws and related offenses, and such information is being acted upon by the IRS.

    3. Informant/Witness—Any person who is already a witness in one investigation but continues to be an informant in another investigation.

    4. Risk Assessment Report—The possible danger to other persons or property in the relocation area from the informant or witness or any relocated family member or close associate of the witness or informant, being placed in the program. See subsection 9.5.11.11.7.1, below for the information to be included in the Risk Assessment Report.

    5. Threat Assessment Report—The possible danger to the witness or informant, as well as members of his/her family or household and/or their close associates, because of his/her cooperation in the government ’s investigation. See subsection 9.5.11.11.7.2, below for the information to be included in the Threat Assessment Report when the investigation is under the jurisdiction of the US Attorney, or is not under the jurisdiction of the US Attorney.

    6. Under the Jurisdiction of the US Attorney— When the US Attorney’s Office is involved in an investigation or has become responsible for the prosecution of an investigation, informant and witness protection responsibilities will then fall under the jurisdiction of the US Attorney. In addition, when CI is submitting a DOJ Witness Security Program request, Department of Justice-Office of Enforcement Operations (DOJ-OEO) policy still requires that the US Attorney’s Office be a referring agency. Refer to subsection 9.5.11.11.7, below for procedures to request authorization to place an individual in the DOJ Witness Security Program.

    7. Not under the Jurisdiction of the US Attorney— Criminal Investigation has the sole responsibility for providing protection for a witness or informant in certain circumstances. These circumstances arise when there exists an immediate danger to the witness or informant (see subsection 9.5.11.11.4, below), the witness or informant refuses protection under the DOJ Witness Security Program (see subsection 9.5.11.11.7, below), or the witness or informant does not qualify for protection under the DOJ Witness Security Program (see subsection 9.5.11.11.8, below).

9.5.11.11.2  (09-09-2004)
Department of Justice Protection

  1. The responsibilities for the security and maintenance of witnesses and their families are placed with the US Marshals Service. Protection and maintenance will be allowed upon the finding of the Director, DOJ-OEO that the proposed witness meets all the following conditions:

    1. the person is a qualifying witness in a specific investigation in process or during or after a grand jury proceeding

    2. evidence exists that indicates the life of the witness or a member of the witness’ family or household is in immediate jeopardy

    3. evidence in possession indicates it would be advantageous to the Federal interest for DOJ to protect the witness and/or a family or household member