Improvements Are Needed to Ensure That Employee Tax Compliance Cases Are Adjudicated Consistently

The IRS Human Capital Officer should ensure that Labor Relations includes all prior substantiated factors in the case file for a potentially willful tax violation determination.

The IRS Human Capital Officer should update the 1203 Case Analysis Form to require that management comment separately on willfulness and reasonable cause.

The IRS Human Capital Officer should ensure that management makes a determination on the willfulness of a tax violation on the 1203 Case Analysis Form by first considering willful factors and then determining if reasonable cause exists to excuse the violation.

The IRS Human Capital Officer should provide annual training to labor relations specialists and management to ensure that both willfulness and reasonable cause factors are documented and commented on when making a determination on a potentially willful tax violation.

The IRS Human Capital Officer should establish processes to ensure that the issue codes and determinations of willfulness are accurately recorded in the ALERTS.