Who’s Who in Tax Disputes: The Role of Congress, the Treasury, and the IRS
Disclaimer: This blog post is not legal advice and is for educational purposes only. This blog post does not create an attorney-client relationship. If you would like to speak to an attorney about a legal matter, please reach out to us today!
When it comes to tax controversies, understanding the key players involved can make navigating the process far less daunting. Here’s a breakdown of the major entities you might encounter and their roles in the tax system:
1. Congress
Congress is responsible for enacting the tax laws that govern our country. These statutes are codified in the Internal Revenue Code (IRC). While Congress sets the rules, it doesn’t administer or enforce them—that's where other entities come into play.
2. The Treasury Department
The Treasury is tasked with implementing the laws passed by Congress. It does so by issuing regulations that interpret and apply these laws. Think of the Treasury as the bridge between the law and its real-world application.
3. The Internal Revenue Service (IRS)
The IRS is a bureau of the Treasury Department. It is responsible for enforcing tax laws, collecting taxes, and overseeing compliance. The IRS’s key roles include:
Conducting audits.
Collecting taxes.
Offering taxpayer assistance.
Enforcing penalties for noncompliance.
4. The Department of Justice (DOJ)
When tax disputes escalate beyond the IRS, the DOJ steps in to handle litigation. This includes federal civil and criminal tax cases in courts, except for matters in the U.S. Tax Court, which the IRS manages directly.
Example
Imagine John, a small business owner in Texas, receives a notice from the IRS claiming a $50,000 deficiency in his tax filings. Unsure how to respond, John learns that his next steps could involve appealing within the IRS, and if unresolved, taking the matter to Tax Court or even federal court through the DOJ. Knowing the roles of these entities helps John decide to consult a tax attorney early, ensuring he’s prepared for each stage of the process.
Tax disputes can be overwhelming, especially when you’re unsure of the entities involved and their powers. At Huenefeld Law, PLLC, we’re here to guide Texans through every step of the process, from handling IRS audits to litigating in federal court. Contact us today for a consultation and let us put our expertise to work for you!
