This is the accessible text file for GAO report number GAO-03-394 
entitled 'Tax Administration: IRS and TIGTA Should Evaluate Their 
Processing of Employee Misconduct under Section 1203' which was 
released on March 17, 2003.



This text file was formatted by the U.S. General Accounting Office 

(GAO) to be accessible to users with visual impairments, as part of a 

longer term project to improve GAO products’ accessibility. Every 

attempt has been made to maintain the structural and data integrity of 

the original printed product. Accessibility features, such as text 

descriptions of tables, consecutively numbered footnotes placed at the 

end of the file, and the text of agency comment letters, are provided 

but may not exactly duplicate the presentation or format of the printed 

version. The portable document format (PDF) file is an exact electronic 

replica of the printed version. We welcome your feedback. Please E-mail 

your comments regarding the contents or accessibility features of this 

document to Webmaster@gao.gov.



Report to the Chairman and Ranking Minority Member, Committee on 

Finance, U.S. Senate:



United States General Accounting Office:



GAO:



February 2003:



Tax Administration:



IRS and TIGTA Should Evaluate Their Processing of Employee Misconduct 

under Section 1203:



GAO-03-394:



GAO Highlights: 



Highlights of GAO-03-394, a report to the Chairman and Ranking Minority 
Member, 

Committee on Finance, U. S. Senate:



February 2003:



Tax Administration:



IRS and TIGTA Should Evaluate Their Processing of Employee Misconduct 

under Section 1203:

 

Why GAO Did This Study: 



Section 1203 of the Internal Revenue Service (IRS) Restructuring and 
Reform Act 

of 1998 outlines conditions for firing IRS employees for any of 10 acts 
of 

misconduct covering taxpayer and employee rights and tax return filing 
requirements. 

Both IRS and the Treasury Inspector General for Tax Administration 
(TIGTA) have 

responsibilities related to section 1203. Because of concerns that 
section 1203 

may have a chilling effect on IRS enforcement staff’s productivity, GAO 
(1) 

determined the number of section 1203 allegations, (2) surveyed IRS 
employee 

perceptions about section 1203, and (3) identified problems IRS and 
TIGTA face 

in processing section 1203 cases and the extent to which they have 
addressed them.



What GAO Found: 



IRS data show that of the 3,970 section 1203 allegations IRS received 
from July 

1998 through September 2002, IRS or TIGTA completed investigations on 
3,512 

allegations and substantiated 419 as violations, resulting in 71 
employees 

being fired for section 1203 misconduct. Employee misconduct related to 
the 

two section 1203 provisions on whether employees filed their tax 
returns on 

time and accurately stated their tax liability (as opposed to the eight 
taxpayer 

and employee rights provisions) accounted for almost all of the 
violations and 

firings. 



Most of the IRS frontline enforcement employees who responded to GAO’s 
survey 

said that they understood, but feared, section 1203. They also reported 
that, 

because of section 1203, their work takes longer and the likelihood of 
their 

taking an enforcement action, such as recommending a seizure, has 
decreased. 

However, employees also were more likely to say that other factors, 
such as 

IRS’s reorganization, have had a greater impact on their ability to do 
their 

job than to say that section 1203 had a greater impact. 



IRS and TIGTA have taken steps intended to correct known problems in 
their 

processing of section 1203 employee misconduct cases—such as lengthy 

investigations and conflicts of interest during investigations—that may 
have 

negatively affected frontline employees’ morale and productivity. 
However, 

the extent to which these steps have succeeded is unknown because IRS 
and 

TIGTA do not have a coordinated approach for evaluating how effectively 
they 

process section 1203 cases. Such an approach would include results-
oriented 

goals, balanced performance measures to mark progress towards these 
goals, 

and means to collect performance data.



Figure: Extent to Which IRS Employees Said They Feared Section 1203:



[See PDF for image]



Note: Percentages may not add to 100 percent because of rounding and a 
few 

“did not know or had no basis to judge” responses.



[End of figure]



What GAO Recommends: 



GAO recommends that IRS and TIGTA coordinate on an approach for 
evaluating the 

section 1203 process to include results-oriented goals for processing 
section 

1203 cases, performance measures that assess progress towards these 
goals, and 

means to collect and analyze related performance data.



In commenting on a draft of this report, IRS agreed with GAO’s 
recommendation 

that a coordinated evaluation of the section 1203 process is desirable 
and TIGTA 

neither agreed nor disagreed. However, both raised a similar concern 
about the 

independence of each agency.



www.gao.gov/cgi-bin/getrpt?GAO-03-394.



To view the full report, including the scope and methodology, click on 
the 

link above. For more information, contact Jim White at (202) 512-9110 
or 

whitej@gao.gov



Contents:



Letter:



Results in Brief:



Background:



Scope and Methodology:



Few Section 1203 Allegations Were Substantiated and Resulted in an 

Employee’s Firing, Except for Those Involving Compliance with Federal 

Tax Laws:



Most Employees Believed That They Understood but Feared Section 1203, 

and That It Was One of Several Factors Affecting Their Work:



IRS and TIGTA Have Taken Steps Intended to Improve the Section 1203 

Process, but Extent of Progress is Unknown:



Conclusions:



Recommendations:



Agency Comments and our Evaluation:



Appendix I: Survey and Case File Review Methodologies:



Survey Methodology:



Case File Review Methodology:



Appendix II: Data on Section 1203 Allegations:



Appendix III: GAO Survey of IRS Frontline Enforcement 

Employees:



Appendix IV: Summary of Content Analysis of Open-Ended 

Comments from GAO Survey of IRS Frontline Enforcement Employees:



Appendix V: Stages of Section 1203 Case Processing:



Reporting and Investigative Determination:



Fact-Finding:



Adjudication:



Appendix VI: Comments from the Internal Revenue Service:



Appendix VII: Comments from the Treasury Inspector General 

for Tax Administration:



Appendix VIII: GAO Contacts and Staff Acknowledgments:



GAO Contacts:



Staff Acknowledgments:



Tables:



Table 1: Summary of Section 1203 Allegations Received, Investigated, 

and Substantiated and of Employee Firings, July 1998 through September 

2002:



Table 2: Summary of Problems Identified, Actions Recommended, and 

Actions Taken to Improve the Section 1203 Process:



Table 3: Number of Cases Opened before, on, or after March 1, 2002:



Table 4: Summary of Substantiated Section 1203 Allegations by 

Disposition, July 1998 through September 2002:



Table 5: Summary of Employee Firings by Type of Misconduct and Employee 

GS-Level, July 1998 through September 2002:



Table 6: Summary of Investigative Results, July 1998 through September 

2002:



Figures:



Figure 1: Employees Said They Had a Clear Understanding of the Types of 

Misconduct under Section 1203:



Figure 2: Extent to Which Employees Said They Were Fearful of Section 

1203:



Figure 3: How Collection Employees Said Section 1203 Affected the 

Likelihood of Their Recommending a Seizure, Lien, or Levy:



Figure 4: How Employees Reported Section 1203 Affected the Likelihood 

of Taking Other Actions Associated with Audit and Collection:



Figure 5: IRS Employee Views on the Impacts of Various Factors on Their 

Ability to Do Their Jobs Compared to Section 1203:



Figure 6: Extent to Which IRS Employees Said Section 1203 Promotes 

Employee Accountability and Respect for Taxpayer Rights:



Figure 7: Summary of Content Analysis of Open-Ended Written Responses:



Figure 8: Case Flow Process for Section 1203 Cases:



Abbreviations:



ALERTS: Automated Labor and Employee Relations Tracking System:



BEPR: Board of Employee Professional Responsibility:



CCPAG: Commissioner’s Complaint Processing and Analysis Group:



EEO: Equal Employment Opportunity:



ETC: Employee Tax Compliance:



IRS: Internal Revenue Service:



SB/SE: Small Business and Self-Employed Operating Division:



TIGTA: Treasury Inspector General for Tax Administration:



This is a work of the U.S. Government and is not subject to copyright 

protection in the United States. It may be reproduced and distributed 

in its entirety without further permission from GAO. It may contain 

copyrighted graphics, images or other materials. Permission from the 

copyright holder may be necessary should you wish to reproduce 

copyrighted materials separately from GAO’s product.



Letter:



February 14, 2003:



The Honorable Charles E. Grassley

Chairman

The Honorable Max Baucus

Ranking Minority Member

Committee on Finance

United States Senate:



On July 22, 1998, the Congress enacted the Internal Revenue Service 

Restructuring and Reform Act[Footnote 1] (Restructuring Act) to balance 

the Internal Revenue Service’s (IRS) responsibility to collect taxes 

with its responsibility to protect the rights of taxpayers and serve 

the public. One provision of the Restructuring Act, section 1203, 

defines 10 specific acts or omissions for which an IRS employee may be 

fired during the performance of official duties. Such acts or omissions 

include harassing a taxpayer, taxpayer representative, or other IRS 

employee, or IRS employees not complying with their tax obligations; 

they are investigated on the basis of allegations made by taxpayers (or 

taxpayer representatives) or IRS employees. Both IRS and the Treasury 

Inspector General for Tax Administration (TIGTA) have responsibilities 

for receiving and investigating such allegations under section 1203 

while IRS has the responsibility for adjudicating violations of section 

1203.



The IRS Commissioner and others have asserted that section 1203 has had 

a negative impact on IRS employees’ morale and effectiveness. In 

particular, they have indicated that section 1203 has had a “chilling 

effect” on IRS frontline enforcement employees who are afraid to take 

certain appropriate enforcement actions, contributing to recent 

declines in IRS’s enforcement activities. In addition, IRS officials 

acknowledge that aspects of the process for receiving, investigating, 

and adjudicating section 1203 allegations (which we refer to as the 

“section 1203 process”), such as long case processing times, may have 

contributed to employees’ fears.



In light of the assertions about possible chilling effects, you asked 

us to assess the implementation of section 1203. Specifically, as 

agreed with your offices, our objectives were to (1) determine the 

number, type, and disposition of section 1203 allegations; (2) 

determine IRS frontline enforcement employees’ perceptions of how 

section 1203 has affected their interactions with taxpayers; and (3) 

identify what problems, if any, IRS and TIGTA have encountered in 

processing section 1203 cases and the extent to which they have 

addressed them. We did not attempt to measure the effectiveness of 

section 1203, or whether its perceived impacts were beneficial or 

harmful. (See our scope and methodology section for details on our 

approach.):



To determine the number, type, and disposition of section 1203 

allegations, we analyzed IRS data for July 1998 (when section 1203 took 

effect) through September 2002. To determine IRS frontline enforcement 

employees’ perceptions of section 1203, we surveyed a random sample of 

audit and collection employees--revenue agents, revenue officers, tax 

auditors, and tax compliance officers. To identify any problems in the 

section 1203 process and the extent to which they have been addressed, 

we reviewed the policies and procedures for processing section 1203 

cases and interviewed responsible officials from IRS and TIGTA.



Results in Brief:



IRS data show that of the 3,970 section 1203 allegations received from 

July 1998 through September 2002, IRS or TIGTA had finished 

investigating 3,512 allegations and substantiated 419 as 

violations.[Footnote 2] Of these 419 violations, 71 resulted in 

firings[Footnote 3] and the rest resulted in a mitigated penalty, the 

employee leaving IRS, or another disposition (see app. II). Employee 

misconduct related to the two tax compliance provisions of section 

1203--late filing of federal tax returns and understatement of federal 

tax liability by IRS employees--accounted for about 93 percent of the 

419 violations and 87 percent of the 71 firings.



On the basis of our survey results, the majority of frontline 

enforcement employees said that they have a clear understanding of the 

types of misconduct under section 1203 but that they had fears 

associated with section 1203, such as being fired.[Footnote 4] They 

also cited section 1203 as one of several factors affecting their work. 

Specifically, over three-quarters of the frontline enforcement 

employees said that the time to do their jobs had increased, and nearly 

two-thirds of those who collect tax debts said that the likelihood of 

recommending a seizure of a taxpayer’s assets had decreased. Further, 

many frontline enforcement employees believe that other factors such as 

IRS’s reorganization and tax law changes have had a greater impact on 

their ability to do their jobs than section 1203.



IRS and TIGTA have taken steps intended to correct known problems--such 

as lengthy investigations and conflicts of interest during 

investigations--that may have reduced the effectiveness of the section 

1203 process as well as the morale and productivity of enforcement 

employees. However, the extent to which these steps have succeeded is 

unknown because IRS and TIGTA have not coordinated on an approach for 

evaluating the section 1203 process on the basis of consistent types of 

results-oriented goals, measures, and performance data. For example, 

IRS has not developed results-oriented timeliness goals or measures or 

tracked the length of time to handle its parts of the section 1203 

process. Until IRS and TIGTA develop a coordinated approach to ensure 

consistent and valid evaluation, IRS and TIGTA cannot determine the 

effectiveness of the entire section 1203 process or any changes to it.



We are recommending that IRS and TIGTA coordinate on an approach for 

evaluating the section 1203 process based on results-oriented goals, 

measures, and related performance data. In commenting on a draft of 

this report, IRS generally agreed with our recommendation and TIGTA 

neither agreed nor disagreed. However, both IRS and Treasury raised a 

similar concern about the independence of each agency. (See agency 

comments and our evaluation and apps. VI and VII.):



Background:



As part of the Restructuring Act, the Congress enacted section 1203, 

which provides for the firing of IRS employees who have been proven to 

commit any of 10 acts or omissions in the performance of their official 

duties, unless a mitigated penalty is appropriate. These 10 acts or 

omissions, which are shown below, can be divided into 2 that relate to 

IRS employees’ tax compliance in filing tax returns and reporting tax 

liability, and 8 that relate to employee and taxpayer rights. 

Specifically, these acts or omissions are:



(1) willful failure to obtain the required approval signatures on 

documents authorizing a seizure of a taxpayer’s home, personal 

belongings, or business assets;



(2) providing a false statement under oath with respect to a material 

matter involving a taxpayer or taxpayer representative;



(3) violating the rights protected under the Constitution or the civil 

rights established under six specifically identified laws with respect 

to a taxpayer, taxpayer representative, or other employee of the 

IRS;[Footnote 5]



(4) falsifying or destroying documents to conceal mistakes made by any 

employee with respect to a matter involving a taxpayer or taxpayer 

representative;



(5) assault or battery of a taxpayer, taxpayer representative, or 

employee of the IRS, but only if there is a criminal conviction, or a 

final judgment by a court in a civil case, with respect to the assault 

or battery;



(6) violating the Internal Revenue Code, Department of Treasury 

regulations, or policies of the IRS (including the Internal Revenue 

Manual) for the purpose of retaliating against, or harassing, a 

taxpayer, taxpayer representative, or other employee of the IRS;



(7) willful misuse of the provisions of section 6103[Footnote 6] of the 

Internal Revenue Code for the purpose of concealing information from a 

congressional inquiry;



(8) willful failure to file any return of tax required under the 

Internal Revenue Code on or before the date prescribed therefore 

(including any extensions), unless such failure is due to reasonable 

cause and not to willful neglect;



(9) willful understatement of federal tax liability, unless such 

understatement is due to reasonable cause and not to willful neglect; 

and:



(10) threatening to audit a taxpayer for the purpose of extracting 

personal gain or benefit.



The Restructuring Act provided the Commissioner with sole discretion, 

which he cannot delegate, to determine whether to take a personnel 

action other than firing an employee (i.e., mitigation) for a section 

1203 violation. Such determination may not be appealed in any 

administrative or judicial proceeding.



The process for receiving, investigating, and adjudicating section 1203 

allegations involves TIGTA and IRS. Under the section 1203 process, 

revised in March 2002, TIGTA has primary responsibility for receiving 

and investigating the allegations, except for those that IRS receives 

and investigates. For example, IRS’s Employee Tax Compliance (ETC) 

unit, using a computer match, has primary responsibility for 

identifying and investigating employee tax compliance issues.[Footnote 

7] Also, IRS’s Office of Equal Employment Opportunity (EEO) is to 

analyze EEO settlement agreements, findings of discrimination, and 

taxpayer complaints of discrimination to identify whether a potential 

section 1203 civil rights violation exists.[Footnote 8] IRS is 

responsible for adjudicating all section 1203 allegations that are 

substantiated as violations.



Generally, each allegation of a potential section 1203 violation must 

be initially evaluated to determine whether it merits a full 

investigation. Then, if an investigation of an allegation uncovers 

sufficient facts to substantiate it (i.e., support a section 1203 

violation), the employee is to be issued a letter notifying him or her 

of the proposed firing from IRS. The employee has a right to respond to 

the letter. Afterwards, if the deciding official determines that the 

evidence sustains the alleged violation, a board established by the IRS 

Commissioner must review the case to determine whether a penalty less 

than firing is appropriate. If the board does not find mitigation to be 

appropriate, the case is not submitted to the IRS Commissioner and the 

employee is fired. If the board recommends mitigation, the Commissioner 

must consider it. If the Commissioner mitigates the penalty, other 

disciplinary actions, such as counseling, admonishment, reprimand, or 

suspension may be applied. Details on the process are provided in 

appendix V.



According to IRS senior management, the misconduct addressed in section 

1203 has always been regarded as serious and subjected to disciplinary 

action. Prior to the enactment of section 1203, the general rules for 

imposing discipline required a deciding official to consider a wide 

range of factors in arriving at the appropriate disciplinary 

action.[Footnote 9] Enactment of section 1203 eliminated the variation 

in penalty for substantiated misconduct, requiring the employee to be 

fired unless the Commissioner mitigates that penalty.



The IRS Commissioner has expressed concerns over the appropriateness of 

the mandatory firing penalty, especially when an IRS employee had 

already paid his or her tax liability or when the allegation involves 

just IRS employees. To address the concerns, IRS, through the 

Department of the Treasury, is seeking legislation to amend section 

1203 by eliminating this penalty for (1) the late filing of tax returns 

for which a refund is due and (2) action by IRS employees that violate 

another employee’s rights. In addition, IRS requested that the 

Commissioner be able to use a range of penalties aside from firing 

employees, for the types of misconduct under section 1203. Further, 

because of the associated seriousness and sensitivity over privacy 

issues, IRS also asked that the unauthorized inspection of returns or 

return information be added to the list of violations under section 

1203.



Scope and Methodology:



To determine the number, type, and disposition of section 1203 

allegations, we analyzed data from IRS’s Automated Labor and Employee 

Relations Tracking System (ALERTS) database as of September 30, 2002. 

The data included all section 1203 cases that had originated in IRS, as 

well as some cases that originated in TIGTA and were either 

investigated or referred to IRS for investigation or 

adjudication.[Footnote 10] On the basis of IRS information on its 

quality control checks of the data, the use of the data, and our review 

of the database, we determined that the data were sufficiently reliable 

to determine the number, type, and disposition of section 1203 

allegations.



To determine IRS employees’ perceptions of how section 1203 has 

affected their interactions with taxpayers, we surveyed a stratified 

random sample of IRS frontline enforcement employees nationwide. Those 

audit or collection employees included revenue agents, revenue 

officers, tax compliance officers, and tax auditors from IRS’s Small 

Business and Self-Employed Division (SB/SE).[Footnote 11] We asked 

questions about their understanding and perceptions of section 1203 and 

its impacts on their jobs. We sent the survey to 455 eligible frontline 

enforcement employees,[Footnote 12] of which 350 responded via regular 

mail, fax, or the Internet between July and September 2002, for a 

response rate of 77 percent. We also did a content analysis of written 

comments volunteered by 208 respondents to arrive at a limited number 

of content categories. A copy of the survey instrument and a summary of 

the content categories are included in appendixes III and IV.



To identify what problems, if any, IRS and TIGTA have encountered in 

processing section 1203 cases and the extent to which they have 

addressed them, we reviewed IRS’s and TIGTA’s policies and procedures 

for receiving, investigating, and adjudicating section 1203 

allegations. We also interviewed IRS and TIGTA officials who are 

responsible for the section 1203 process. In addition, we reviewed a 

study done by IRS, TIGTA, and a private consulting firm to streamline 

the section 1203 process, and discussed the study with their officials. 

To understand the process and gauge the length of time that section 

1203 cases take to process, we reviewed 92 of the 100 most recently 

closed cases as of August 30, 2002, according to IRS’s ALERTS database; 

in 5 cases, the files could not be located for employees who retired or 

otherwise left IRS and 

3 cases were duplicates. We recorded dates and decisions for various 

stages of the process.



We did not attempt to measure the effectiveness of section 1203 and 

whether its impacts on IRS employees were positive or negative. 

Appendix I contains more detailed information on our survey design and 

administration and case file review approaches. We conducted our review 

in Washington, D.C., from November 2001 to December 2002 in accordance 

with generally accepted government auditing standards.



Few Section 1203 Allegations Were Substantiated and Resulted in an 

Employee’s Firing, Except for Those Involving Compliance with Federal 

Tax Laws:



IRS data show that, with the exception of employees’ tax compliance 

provisions, few of the 3,970 section 1203 allegations received between 

July 1998 and September 2002 were substantiated as violations of 

section 1203 and resulted in an employee’s firing. Table 1 shows what 

happened to the 3,970 allegations in terms of completed investigations, 

substantiated allegations, and firings.[Footnote 13]



Table 1: Summary of Section 1203 Allegations Received, Investigated, 

and Substantiated and of Employee Firings, July 1998 through September 

2002:



Type of section 1203 misconduct: Taxpayer and employee rights; Section 

1203 allegations: Received: [Empty]; Section 1203 allegations: 

Completed investigations: [Empty]; Section 1203 allegations: 

Substantiated: [Empty]; Section 1203 allegations: IRS employee firings: 

[Empty].



Type of section 1203 misconduct: Seizure without approval; Section 1203 

allegations: Received: 16; Section 1203 allegations: Completed 

investigations: 13; Section 1203 allegations: Substantiated: 0; Section 

1203 allegations: IRS employee firings: 0.



Type of section 1203 misconduct: False statement under oath; Section 

1203 allegations: Received: 22; Section 1203 allegations: Completed 

investigations: 21; Section 1203 allegations: Substantiated: 1; Section 

1203 allegations: IRS employee firings: 0.



Type of section 1203 misconduct: Civil rights/constitutional rights; 

Section 1203 allegations: Received: 291; Section 1203 allegations: 

Completed investigations: 262; Section 1203 allegations: 

Substantiated: 1; Section 1203 allegations: IRS employee firings: 0.



Type of section 1203 misconduct: Falsifying or destroying documents; 

Section 1203 allegations: Received: 81; Section 1203 allegations: 

Completed investigations: 66; Section 1203 allegations: Substantiated: 

10; Section 1203 allegations: IRS employee firings: 3.



Type of section 1203 misconduct: Assault or battery; Section 1203 

allegations: Received: 10; Section 1203 allegations: Completed 

investigations: 8; Section 1203 allegations: Substantiated: 1; Section 

1203 allegations: IRS employee firings: 1.



Type of section 1203 misconduct: Retaliation or harassment; Section 

1203 allegations: Received: 1,729; Section 1203 allegations: Completed 

investigations: 1,680; Section 1203 allegations: Substantiated: 6; 

Section 1203 allegations: IRS employee firings: 1.



Type of section 1203 misconduct: Misuse of section 6103 to conceal 

information; Section 1203 allegations: Received: 5; Section 1203 

allegations: Completed investigations: 3; Section 1203 allegations: 

Substantiated: 0; Section 1203 allegations: IRS employee firings: 0.



Type of section 1203 misconduct: Threat to audit for personal gain; 

Section 1203 allegations: Received: 88; Section 1203 allegations: 

Completed investigations: 77; Section 1203 allegations: Substantiated: 

12; Section 1203 allegations: IRS employee firings: 4.



Type of section 1203 misconduct: Subtotal; Section 1203 allegations: 

Received: 2,242; Section 1203 allegations: Completed investigations: 

2,130; Section 1203 allegations: Substantiated: 31; Section 1203 

allegations: IRS employee firings: 9.



Type of section 1203 misconduct: Compliance with federal tax laws; 

Section 1203 allegations: Received: [Empty]; Section 1203 allegations: 

Completed investigations: [Empty]; Section 1203 allegations: 

Substantiated: [Empty]; Section 1203 allegations: IRS employee firings: 

[Empty].



Type of section 1203 misconduct: Failure to timely file federal tax 

return; Section 1203 allegations: Received: 1,042; Section 1203 

allegations: Completed investigations: 914; Section 1203 allegations: 

Substantiated: 345; Section 1203 allegations: IRS employee firings: 55.



Type of section 1203 misconduct: Understatement of federal tax 

liability; Section 1203 allegations: Received: 686; Section 1203 

allegations: Completed investigations: 468; Section 1203 allegations: 

Substantiated: 43; Section 1203 allegations: IRS employee firings: 7.



Type of section 1203 misconduct: Subtotal; Section 1203 allegations: 

Received: 1,728; Section 1203 allegations: Completed investigations: 

1,382; Section 1203 allegations: Substantiated: 388; Section 1203 

allegations: IRS employee firings: 62.



Type of section 1203 misconduct: Total; Section 1203 allegations: 

Received: 3,970[A]; Section 1203 allegations: Completed 

investigations: 3,512[B]; Section 1203 allegations: Substantiated: 

419; Section 1203 allegations: IRS employee firings: 71.



Source: GAO analysis of IRS data.



[A] In addition, IRS forwarded 1,196 taxpayer allegations of section 

1203 misconduct to its Frivolous Return Program. Further, IRS’s 

Discrimination Complaint Review Unit received 1,003 EEO settlements 

and/or findings of discrimination involving civil rights or 

constitutional issues.



[B] At the time of our review, another 351 allegations were in the 

process of being investigated, while 107 allegations were not 

investigated due to such reasons as the employee resigning or retiring.



[End of table]



Table 1 shows that IRS or TIGTA had finished investigating 3,512 

allegations and substantiated 419 as violations, for which IRS fired 71 

employees. Of the other 348 violations, IRS’s Commissioner mitigated 

the penalty for 166; the employees resigned or retired for 117; the 

employees were fired on other grounds or during their probationary 

period for 33; and IRS had not finalized the decision for another 32. 

Appendix II shows the dispositions of all 419 violations by type of 

section 1203 misconduct and the grade level of the 71 fired employees.



Table 1 also shows that most of the violations and related firings 

involved the two tax compliance provisions of section 1203. The failure 

to file tax returns on time and the understatement of federal tax 

liability accounted for 388 of the 419 violations (93 percent) and 62 

of the 71 firings (87 percent). The rest of the violations and related 

firings involved the remaining 8 provisions, which deal with employee 

and taxpayer rights. IRS officials said that the bulk of the violations 

and firings involved the two tax compliance provisions of section 1203 

because IRS has a systemic computerized process to identify and 

evaluate potential employee tax compliance issues. Further, according 

to officials, these issues generally are more factually based and 

involve clearer indicators of misconduct.



To understand why 3,093 investigated allegations were not 

substantiated, we analyzed IRS data and talked with IRS officials. As 

shown in appendix II, 800 of these investigated allegations were not 

substantiated as section 1203 violations but were substantiated as 

misconduct violations unrelated to section 1203. Of those remaining, 

1,549 involved allegations of retaliation and harassment of a taxpayer, 

taxpayer representative, or IRS employee. Although IRS had not done a 

systematic analysis, IRS officials offered possible reasons why these 

investigated allegations could not be substantiated as section 1203 

violations. These officials said that many were not credible. For 

example, the officials cited cases in which a taxpayer representative 

routinely lodged allegations whenever enforcement employees contacted 

clients. Another cited example was when taxpayers’ allegations had more 

to do with their protests about having to meet their tax obligations.



Most Employees Believed That They Understood but Feared Section 1203, 

and That It Was One of Several Factors Affecting Their Work:



Our survey indicated that most frontline enforcement employees 

understood but feared section 1203, and that, because of section 1203, 

their work takes longer and the likelihood of their recommending a 

seizure decreased. Otherwise, employees’ reported views were not as 

strong on the impacts of section 1203 on other audit or collection 

activities. At the same time, many employees said that, other factors, 

such as IRS’s reorganization, have had a greater impact on their 

ability to do their jobs than section 1203.



Most Frontline Enforcement Employees Said They Understand the Types of 

Section 1203 Misconduct:



The overwhelming majority of frontline enforcement employees reported 

that they understood the types of misconduct covered by section 1203. 

Figure 1 shows that for 9 of the 10 provisions, at least three-quarters 

of the employees said they had a very or generally clear understanding 

of misconduct under section 1203. For the provision on the misuse of 

section 6103 to conceal information from a congressional inquiry--about 

68 percent of the employees said they had a very or generally clear 

understanding of misconduct covered by section 1203.



Figure 1: Employees Said They Had a Clear Understanding of the Types of 

Misconduct under Section 1203:



[See PDF for image]



Note: Percentages may not add to 100 percent because of rounding and a 

few “did not know” responses.



[End of figure]



In addition, an estimated 48 percent of the employees said that IRS had 

provided, to a very great or great extent, clear examples of what 

constitutes harassment or retaliation under section 1203. Only about 

7 percent said that IRS provided such examples to little or no 

extent.[Footnote 14]



Most Frontline Enforcement Employees Reported Fears Associated with 

Section 1203:



The majority of employees reported fears associated with section 1203. 

As shown in figure 2, at least two-thirds reported that they were 

somewhat or very fearful of having a taxpayer file an allegation and 

being investigated. Almost as many said they were somewhat or very 

fearful of being fired.[Footnote 15]



Figure 2: Extent to Which Employees Said They Were Fearful of Section 

1203:



[See PDF for image]



Note: Percentages may not add to 100 percent because of rounding and a 

few “did not know or had no basis to judge” responses.



[End of figure]



Written comments, while not representative of all respondents, provide 

some insights on employees’ fears. For example, several employees 

described fears of being falsely accused by a taxpayer while others 

noted a fear of being investigated for making an honest mistake. A 

number of employees expressed more general fears of section 1203. For 

example, one employee wrote, “I acknowledge that my fears may be 

irrational, and I would hope that the system would work as it is 

designed. I could envision a complaint (unfounded, I would hope) being 

filed, and the resulting anxiety would be overwhelming.”:



Further, the survey revealed that most frontline enforcement employees 

had little or no confidence in the disciplinary process for section 

1203. For example, an estimated 50 percent of the employees said they 

are not at all confident and 18 percent reported that they had little 

confidence that they will not be disciplined for making an honest 

mistake.[Footnote 16]



IRS officials said that they believe the fear and distrust of section 

1203 is pervasive among all types of frontline enforcement employees. 

However, they indicated that those most affected and concerned are 

revenue officers who have face-to-face contacts with delinquent 

taxpayers.[Footnote 17]



Many Frontline Enforcement Employees Reported That Section 1203 

Contributes to Work Taking Longer and a Decline in Seizure Activity:



Many frontline enforcement employees perceived that section 1203 

contributed to work taking longer and to a decline in seizure activity. 

Otherwise, employees reported views that were not as strong on the 

impacts of section 1203 on other frontline enforcement activities, such 

as those associated with audits or collections.



Such perceptions are important because IRS management believes that 

declines in enforcement activities since 1998 resulted, in part, from 

employees’ reluctance to use enforcement tools due to section 1203 

fears.[Footnote 18] Our survey results on employees’ perceptions of 

changes in job behavior are broadly correlated with actual declines in 

enforcement activities, such as seizures. However, this broad 

correlation should be interpreted with caution because employee 

perceptions do not necessarily demonstrate causation and section 1203 

is unlikely to be the only reason for the decline in enforcement 

activity. Further, any changes in enforcement activity could be 

positive or negative, depending on whether the activity was merited.



One job behavior that employees reported being affected by section 1203 

was the time spent to do their work. An estimated 80 percent of 

frontline enforcement employees said that work took longer as a result 

of section 1203.[Footnote 19] Some written comments helped to 

illustrate why employees believed their work takes longer. For example, 

one employee wrote, “[I am] more cautious [and allow] more time to 

avoid harassment allegations.” Another said, “the greatest impact [of 

section 1203] has been on the amount of time necessary to work a case-

-ensuring that taxpayer rights are made clear and protected through 

every step.”:



In addition, many employees responsible for collections, such as 

issuing seizures, liens, and levies,[Footnote 20] said that section 

1203 has affected how they do their jobs. As figure 3 shows, an 

estimated 67 percent of the collection employees said that the 

likelihood of their recommending a seizure of taxpayer assets to 

satisfy a tax debt had decreased (including somewhat or greatly); 

reported views were not as strong on the likelihood of recommending a 

levy or lien decreasing.[Footnote 21]



Figure 3: How Collection Employees Said Section 1203 Affected the 

Likelihood of Their Recommending a Seizure, Lien, or Levy:



[See PDF for image]



Note: Percentages may not add to 100 percent because of rounding and a 

few “did not know” responses.



[End of figure]



The written comments helped to illustrate why collection employees said 

they were less likely to take collection actions. Several employees 

indicated that they second-guess their decisions as a result of section 

1203. One employee wrote, “[Section 1203] has forced me to doubt my own 

judgment on enforcement matters, especially . . . where some issues are 

vague and the collection officer has to use his or her judgment.” 

Another employee noted, “[Section] 1203 has made me hesitant to take 

any action and has slowed work progress since each and every action has 

the potential to create a section 1203 violation. There is so much 

information that we are responsible to know and any act, willful or 

not, can result in a disciplinary action.”:



Employees reported views that were not as strong on the impacts of 

section 1203 on other frontline enforcement activities. For example, 

figure 4 shows that except for one action--contacting a third party--

roughly half or more than half of the employees reported that section 

1203 had no impact on the likelihood of their taking actions that can 

be associated with audits such as requesting, reviewing, or questioning 

documents submitted by taxpayers.[Footnote 22]



Figure 4: How Employees Reported Section 1203 Affected the Likelihood 

of Taking Other Actions Associated with Audit and Collection:



[See PDF for image]



Note: Percentages may not add to 100 percent because of rounding and a 

few “did not know” responses.



[End of figure]



Many Employees Said That IRS’s Reorganization and Tax Law Changes Have 

Had a Greater Impact on Their Ability to do Their Jobs Than Section 

1203:



Many IRS frontline enforcement employees also reported that IRS’s 

reorganization and tax law changes have had a greater impact on their 

ability to do their jobs than section 1203.[Footnote 23] As shown in 

figure 5, a higher percentage of employees reported that IRS’s 

reorganization and tax law changes have had a greater impact rather 

than a lesser impact on their ability to do their jobs compared to 

section 1203.[Footnote 24]



Figure 5: IRS Employee Views on the Impacts of Various Factors on Their 

Ability to Do Their Jobs Compared to Section 1203:



[See PDF for image]



Note: Percentages may not add to 100 percent because of rounding and a 

few “did not know or had no basis to judge” responses.



[End of figure]



Some written comments indicated employee’s perceptions on how the other 

factors had an effect on their ability to do their jobs. For example, 

one employee wrote, “The restructuring has created areas where there is 

no accountability. Frontline employees have nowhere to go when not 

receiving services, as the person providing the service is in a 

different division . . . .” Another wrote, “The ongoing complex tax law 

changes in conjunction with the threat of losing your job (under 

section 1203) if you don’t correctly implement all of the changes is 

what greatly impacts our ability to do the job.”:



IRS officials indicated that the impacts of section 1203 on employees 

cannot be isolated from those of such factors as IRS’s reorganization 

and tax law changes because they are interrelated. For example, the 

officials said that section 1203 itself is part of the reorganization 

and is a tax law change that some view as complex.



Most Frontline Enforcement Employees Said Section 1203 Has Had Some 

Impact in Promoting Employee Accountability and Respect for Taxpayer 

Rights:



As figure 6 shows, we estimate that at least 60 percent of the 

enforcement employees perceived section 1203 as promoting some degree 

of employee accountability and respect for taxpayer rights. We also 

estimate that about 30 percent of the employees perceived section 1203 

as doing little or nothing to promote accountability or respect for 

taxpayer rights.[Footnote 25]



Figure 6: Extent to Which IRS Employees Said Section 1203 Promotes 

Employee Accountability and Respect for Taxpayer Rights:



[See PDF for image]



Note: Percentages may not add to 100 percent because of rounding and a 

few “did not know or had no basis to judge” responses.



[End of figure]



Some written comments indicated ways that employees perceived section 

1203 as promoting employee accountability and respect for taxpayer 

rights. One employee wrote, “These changes were needed and . . . it has 

been a change for the better and hopefully has increased our trust and 

faith in the general public, our clients, the taxpayers.” Another 

employee noted, “Section 1203 make[s] IRS employees accountable and 

promotes respect for taxpayers . . . .”:



In other written comments, however, some employees offered their 

perceptions of how section 1203 did little or nothing to promote 

employee accountability or to promote taxpayer rights. For example, one 

employee wrote, “Employees who safeguard taxpayers’ rights are those 

who would have anyway--section 1203 did not affect that.” Another 

noted, “We have . . . always been aware of and made every effort to 

respect the taxpayer’s rights. [Section] 1203 does not enhance 

taxpayer’s rights or . . . efforts to ensure those rights are 

honored.”:



IRS and TIGTA Have Taken Steps Intended to Improve the Section 1203 

Process, but Extent of Progress is Unknown:



IRS and TIGTA have taken steps intended to correct known problems, such 

as lengthy investigations and conflicts of interest during 

investigations, that may have reduced the effectiveness of the section 

1203 process as well as the morale and productivity of enforcement 

employees. However, the extent to which these steps have succeeded is 

unknown because IRS and TIGTA have not coordinated on an approach for 

evaluating the section 1203 process on the basis of consistent types of 

results-oriented goals, measures, and performance data. Until IRS and 

TIGTA develop a coordinated approach to ensure consistent and valid 

evaluation, they cannot determine the effectiveness of the entire 

section 1203 process or any changes to it.



IRS and TIGTA Made Changes to Address Problems with the Section 1203 

Process:



IRS and TIGTA made changes to address problems with the process for 

receiving, investigating, and adjudicating section 1203 allegations. 

IRS initially identified some of these problems through a limited 

review to check employee concerns that section 1203 cases were not 

being resolved in a timely manner. The review revealed that, on 

average, IRS investigations took over 200 days and TIGTA investigations 

took over 

300 days.[Footnote 26] In October 2001, IRS and TIGTA initiated a more 

comprehensive study to assess the causes of lengthy processing times 

and identify other problems associated with the process for receiving, 

investigating, and adjudicating section 1203 cases. A team of IRS, 

TIGTA, and private consulting firm officials did the study, which 

resulted in recommendations to reengineer the process to improve 

performance. The team issued a final report in January 2002.[Footnote 

27]



The team identified several problems with the section 1203 process, 

such as cases changing hands frequently within and between IRS and 

TIGTA and use of multiple and inconsistent procedures for processing 

section 1203 allegations. The team developed recommendations to correct 

the problems and improve the section 1203 process.[Footnote 28] On the 

basis of the recommendations, IRS implemented some changes in March 

2002.[Footnote 29] 

Table 2 lists the problems identified by the team,[Footnote 30] its 

recommended actions, and actions taken.



Table 2: Summary of Problems Identified, Actions Recommended, and 

Actions Taken to Improve the Section 1203 Process:



Problems identified: Section 1203 cases changed hands frequently within 

IRS and TIGTA, which added to long case processing times.; Actions 

recommended: Establish a Board of Employee Professional Responsibility 

(BEPR) to streamline the section 1203 process and to 

(1) oversee the section 1203 process; (2) receive and review all 

allegations for investigative merit; and (3) issue clearance letters to 

inform employees on decisions about the allegations through the 

Commissioner’s Complaint Processing and Analysis Group (CCPAG).[A]; 

Actions taken: BEPR was established and (1) is not responsible for 

overseeing the section 1203 process; (2) TIGTA is to receive most 

allegations and determine their investigative merit, while BEPR is to 

determine the investigative merit of allegations referred to it by 

TIGTA; and (3) CCPAG is to issue clearance letters to IRS employees.



Problems identified: Multiple, inconsistent procedures for section 1203 

cases, as reflected in a section 1203 handbook.; Actions recommended: 

No specific recommendation was made.; Actions taken: Actions taken to 

streamline the process were viewed as ways to address multiple, 

inconsistent procedures.



Problems identified: IRS and TIGTA lacked a centralized database for 

section 1203 case information.; Actions recommended: Develop a 

centralized database of information on section 1203 that will interface 

with TIGTA’s system.; Actions taken: Rather than developing a central 

database, a system to share section 1203 data between IRS and TIGTA is 

being developed.



Problems identified: IRS managers investigated employees for section 

1203 misconduct, creating conflicts of interest, and lacked skills to 

do investigations.; Actions recommended: TIGTA should be responsible 

for investigating section 1203 allegations.; Actions taken: TIGTA is 

responsible for conducting most investigations.[B].



Source: GAO review of Booz-Allen study.



[A] To better respond to employee and taxpayer complaints, the IRS 

Commissioner established CCPAG. In October 1999, CCPAG began 

controlling section 1203 complaints referred from TIGTA.



[B] According to IRS officials, IRS managers still do some section 1203 

investigations, such as tax compliance-related allegations.



[End of table]



Although many of the team’s recommendations were implemented, some were 

not implemented or were modified. IRS and TIGTA officials said that 

modifications resulted because both agencies agreed, after the 

recommendations were developed, that TIGTA would be more involved in 

screening and investigating most allegations.



For example, IRS modified the recommendation to create a BEPR[Footnote 

31] that would receive section 1203 allegations, determine their 

investigative merit, and oversee the section 1203 process. IRS had 

created BEPR to handle these duties because IRS and TIGTA had not 

agreed on the extent of TIGTA’s involvement. By the time that the new 

process was implemented, IRS and TIGTA had agreed that TIGTA would 

handle allegations for section 1203, with some exceptions.[Footnote 32] 

As a result, BEPR’s responsibility was limited to determining the merit 

of only those allegations forwarded to it by TIGTA and did not include 

oversight of the whole section 1203 process. IRS officials said that 

having two independent agencies responsible for different parts of the 

section 1203 process complicates having one agency responsible for 

overseeing the other agency.



Rather than creating a centralized database, IRS and TIGTA officials 

described plans to modify an existing database to allow certain section 

1203 data to be downloaded and shared between IRS and TIGTA. To do 

this, IRS has hired a contractor to develop such integrated data 

sharing. IRS officials said they plan to begin testing and implementing 

this new system sometime in 2003. Both IRS and TIGTA officials said 

that creating a centralized database for section 1203 cases would not 

be efficient or practical since both agencies use their respective 

databases to track various types of employee misconduct cases--not just 

those relating to section 1203. In addition, TIGTA officials said that 

sharing one database could compromise the integrity of TIGTA’s 

investigations, given the sensitivity of certain case information.



IRS officials said that the study did not make specific recommendations 

to address the multiple, inconsistent procedures. These officials said 

that they believe that the attempts to streamline the process will help 

to address these problems. For example, the new process clarifies that 

TIGTA is to be responsible for receiving and investigating most section 

1203 allegations. IRS reflected the new process in a revised section 

1203 handbook that eliminated some criteria on making various decisions 

(e.g., mitigation). IRS officials said that they did not retain these 

criteria because all IRS employees did not need such details. They 

indicated that they plan to begin developing customized guidelines 

during early 2003 for targeted audiences, such as labor relation 

specialists.



IRS and TIGTA Have Not Coordinated on an Approach for Evaluating 

Whether the New Section 1203 Process Corrected the Problems and 

Operated Effectively:



IRS and TIGTA have not coordinated on an approach for evaluating the 

section 1203 process on the basis of consistent types of results-

oriented goals, measures, and performance data. Until IRS and TIGTA 

develop a coordinated approach to ensure consistent and valid 

evaluation, IRS and TIGTA cannot determine the effectiveness of the 

entire section 1203 process or any changes to it, such as those made in 

March 2002.



We have issued a number of reports[Footnote 33] on the value added to 

agency operations by using results-oriented goals and balanced measures 

to guide and evaluate performance, avoid focusing on one aspect of 

performance at the expense of others, and ensure that any changes to a 

program or process are having the desired results rather than 

unintended consequences.[Footnote 34] These reports also have discussed 

the value of planning evaluations of performance of a program or 

process early so that arrangements can be made to ensure collection of 

the needed data.



IRS and TIGTA have not developed agreed-upon goals or measures for 

evaluating the effectiveness of the section 1203 process or means for 

collecting related performance data. For example, IRS has not 

established goals or measures for timely adjudication of section 1203 

cases and does not collect information on the amount of time to 

adjudicate cases. To obtain a current view on section 1203 case 

processing time, we analyzed 92 of the 100 most recently closed cases 

in IRS’s database by the end of August 2002.[Footnote 35] Our analysis 

showed that the median number of days involved in the process was 186 

days and that 80 percent of the cases ranged between 78 days and 774 

days.



IRS officials said that they do not have a formal system for evaluating 

the section 1203 process--including goals and measures--because IRS 

does not have such a system for any of its employee disciplinary 

processes. TIGTA officials indicated that TIGTA has a strategic goal of 

120 days to investigate and refer all administrative cases to IRS and a 

365-day goal for all criminal cases. Although such goals can apply to 

section 1203 investigations, TIGTA officials said that they have not 

evaluated whether its section 1203 investigations have met these goals.



Without such performance indicators, IRS and TIGTA cannot determine 

whether the new process corrected the known problems and improved the 

section 1203 process as intended--that is, to reduce the number of 

handoffs, shorten the processing time, and eliminate conflicts of 

interest. Further, IRS and TIGTA cannot determine how effectively they 

process section 1203 allegations or whether future changes to the 

section 1203 process will be needed.



During December 2002, IRS officials told us they plan to develop goals 

and measures for evaluating all IRS disciplinary processes, including 

section 1203. Although they could not provide documentation on how this 

evaluation system would work, they said they plan to implement the 

evaluation system during fiscal year 2003. On the basis of informal 

tracking, they said that they believe that the new section 1203 process 

has expedited the determination of investigative merit and adjudication 

of violations. They acknowledged the value of having objective data on 

section 1203 and believed that this informal tracking system can be 

used to help develop appropriate goals and measures for the formal 

evaluation system.



Conclusions:



The Congress included section 1203 in the Restructuring Act, in part, 

to minimize certain types of IRS employee misconduct in dealing with 

taxpayers. On the basis of our survey results, most IRS enforcement 

employees do perceive that section 1203 has affected their behavior, 

such as taking longer to work audit or collection cases and having some 

reluctance to take enforcement actions. The survey results by 

themselves, however, do not provide a basis for conclusions about 

whether section 1203 has worked or should be changed. On the one hand, 

their perceptions about longer case times and a reluctance to take 

action are consistent with the fear of section 1203 felt by many 

enforcement employees. On the other hand, any increase in the amount of 

time to work cases also could result from other impacts of section 1203 

seen by employees, such as promoting increased employee accountability 

and respect for taxpayer rights. Moreover, policymakers might be 

willing to accept longer case times and some fear of taking enforcement 

actions when merited if the tradeoff is greater respect for taxpayer 

rights.



One influence on how enforcement employees perceive section 1203 is the 

IRS and TIGTA process for handling section 1203 allegations. However, 

our survey found widespread distrust of the process. Further, IRS and 

TIGTA recognized that problems with the section 1203 process were 

affecting employee morale and productivity. Consequently, they 

implemented a new process in March of 2002. Evaluation of the new 

process is important because of the potential impact on IRS employees 

and ultimately taxpayers. While too few section 1203 cases have been 

closed under the new process for an evaluation to date, IRS and TIGTA 

have not developed an evaluation approach. Any evaluation of 

effectiveness would have to be based on results-oriented goals and 

related performance measures. Developing an approach now would help 

ensure timely collection of the needed data.



Recommendations:



We recommend that the Acting Commissioner of Internal Revenue and the 

Acting Treasury Inspector General for Tax Administration coordinate on 

an approach for evaluating the section 1203 process. In developing this 

approach, IRS and TIGTA also should develop (1) results-oriented goals 

for processing section 1203 cases, (2) performance measures that are 

balanced and can be used to assess progress towards those goals, and 

(3) methods for collecting and analyzing performance data related to 

the goals and measures.



Agency Comments and our Evaluation:



On February 6, 2003, the Acting Commissioner of the Internal Revenue 

and the Acting Treasury Inspector General for Tax Administration each 

provided written comments on a draft of this report. (See appendix VI 

and appendix VII, respectively.) In general, IRS agreed with our 

recommendation that a coordinated evaluation of the section 1203 

process is desirable, and TIGTA neither agreed nor disagreed with our 

recommendation. However, both agencies raised a similar concern about 

the independence of each agency. Specifically, IRS said that TIGTA’s 

independent role makes it inappropriate for IRS to oversee TIGTA’s 

performance. TIGTA pointed to legislative challenges in implementing 

our recommendation because Restructuring Act amendments to the 

Inspector General Act of 1978 created TIGTA as an independent agency 

with autonomy from IRS.



We recognize that IRS and TIGTA are independent agencies. As noted in 

our report, this independence is why IRS and TIGTA need to coordinate 

on the evaluation. In this sense, coordination does not mean that 

either agency evaluate, oversee, or direct the other agency. Rather, 

coordination means that IRS and TIGTA officials communicate on how each 

agency will develop goals, measures, and methods for collecting related 

data to better ensure that the entire section 1203 process is 

evaluated, using consistent and valid goals and measures.



We do not believe that such coordination would jeopardize the 

independence of TIGTA from IRS, particularly when IRS and TIGTA already 

have been working together on managing and improving the section 1203 

process, as discussed in TIGTA’s as well as IRS’s comments. We view our 

recommendation on developing a coordinated approach as part of that 

continued communication. We made minor wording changes to our 

recommendation in order to clarify the need for a coordinated 

evaluation approach.



As agreed with your offices, unless you publicly announce its contents 

earlier, we plan no further distribution of this report until 30 days 

from the date of this report. At that time, we will send copies to the 

Secretary of the Treasury; the Acting Treasury Inspector General for 

Tax Administration; the Acting Commissioner of Internal Revenue; and 

the Director of Office of Management and Budget. We will make copies 

available to others on request. In addition, the report will be 

available at no charge on GAO’s Web site at http://www.gao.gov.



If you have any questions, please contact me or Tom Short on (202) 512-

9110. Key contributors to this report are acknowledged in appendix 

VIII.



James R. White

Director, Strategic Issues:



Signed by James R. White:



[End of section]



Appendix I: Survey and Case File Review Methodologies:



This appendix discusses the methodology we used to survey the Internal 

Revenue Service (IRS) employees on how section 1203 affected their 

interactions with taxpayers. We also discuss our methodology for a 

review of IRS case files to determine how long section 1203 cases were 

taking to process.



Survey Methodology:



To determine IRS frontline enforcement employees’ perceptions of how 

section 1203 has affected their interactions with taxpayers, we 

surveyed a random sample of IRS frontline enforcement employees in the 

Small Business/Self Employed Operating Division (SB/SE) who had direct 

contact with taxpayers and taxpayer representatives. We administered 

the survey between July and September 2002 to a stratified sample of 

IRS employees identified through IRS’s personnel database.



Study Population:



The study population from which the sample was drawn consisted of 

10,186 SB/SE frontline enforcement employees nationwide as of June 

2002. To ensure that the study population only included frontline 

enforcement employees who had regular contact with taxpayers and 

taxpayer representatives, IRS managers familiar with the positions 

reviewed a list of titles for all positions in the GS-512 job series 

(revenue agents), GS-1169 job series (revenue officers), GS-526 job 

series (tax compliance officers), an GS-501 and GS-598 job series (tax 

auditors), and identified position titles in these 5 series where the 

incumbent would have regular contact with taxpayers and taxpayer 

representatives.



Sample Design:



The sample design for this survey is a single-stage stratified sample 

of IRS frontline enforcement employees in SB/SE. We drew a sample of 

500 employees composed of 4 strata--revenue agents, revenue officers, 

tax compliance officers, and tax auditors.



After we administered the survey, we adjusted the original survey and 

sample population size because 45 respondents indicated that they did 

not have contact with taxpayers and taxpayer representatives. These 

respondents were considered “ineligible” to participate in our survey 

and were subsequently excluded. We adjusted the final sample size to 

455. We received 350 completed responses to our survey--a response rate 

of 77 percent. The remaining 105 cases were considered to be 

nonrespondents.



Calculation of Sample Estimates:



All estimates produced in this report are for a study population 

defined as IRS’s SB/SE frontline enforcement employees who have contact 

with taxpayers and taxpayer representatives. We designed our sample to 

produce precise estimates of this population on a nationwide basis. As 

a result, we did not perform any analyses by stratum. Further, we 

created the estimates by weighting the survey responses to account for 

the sampling rate in each stratum. The weights reflect both the initial 

sampling rate and the response rate for each stratum.



Sampling Error:



We randomly selected the sample used for this study based on a 

probability procedure. As a result, our sample is only one of a large 

number of samples that we might have drawn from the total population of 

SB/SE frontline enforcement employees. If different samples had been 

taken from the same population, it is possible that the results would 

have been different. To recognize the possibility that other samples 

may have yielded other results, we express our confidence in the 

precision of our particular sample’s results as a 95-percent confidence 

interval. For all the percentages presented in this report, unless 

otherwise noted, we are 

95-percent confident that the results we obtained are within plus or 

minus 10 or fewer percentage points of what we would have obtained if 

we had surveyed the entire study population. For example, our survey 

estimates that 58 percent of the respondents indicated that section 

1203 had no effect on their likelihood of requesting documents from a 

taxpayer. The 95-percent confidence interval for this estimate would be 

between 48 percent and 68 percent. We calculated the confidence 
intervals 

for our study results using methods that are appropriate for a 
stratified 

probability sample.



Nonsampling Error:



In addition to the reported sampling errors, the practical difficulties 

of conducting any survey may introduce other types of errors, commonly 

referred to as nonsampling errors. For example, questions may be 

misinterpreted, the respondents’ answers may differ from those who did 

not respond, or errors could be made in keying the questionnaire 

responses into a data file. We took several steps to reduce such 

errors.



We pretested the survey questions with employees from SB/SE who were 

part of the survey’s target population. After the survey 

administration, we examined the response rate for each of the 4 strata 

to determine whether any of the strata were underrepresented. The 

response rates for the revenue agent, revenue officer, tax compliance 

officer, and tax auditor strata were 89 percent, 87 percent, 78 

percent, and 44 percent, respectively. We did not assess the impact of 

the nonrespondents on our results. To the extent that the 

nonrespondents had different views than the respondents, then our 

findings would be biased. The response rates for the revenue agent, 

revenue officer, and tax compliance officer strata are fairly high and 

give us a high degree of confidence that our findings for these groups 

are likely to be representative of the fuller populations. The 

44 percent response rate for the tax auditor strata raises the 

possibility that the results for this group may have been different if 

more employees had chosen to complete the survey.



To ensure the integrity of the survey data, we performed a quality 

control check on the surveys that were keyed into an automated data 

file. We found no keying errors.



Survey Development:



We identified areas to cover in the survey based on our congressional 

request and initial interviews with IRS and National Treasury Employees 

Union officials.



We pretested the survey to IRS revenue agents, revenue officers, and 

tax compliance officers at three IRS field offices (at the time of the 

pretests, tax auditors were unavailable). Two of the offices were 

located in suburban Maryland and another was located in Washington, 

D.C. In doing the pretest, we evaluated the appropriateness of the 

survey questions and the various formats we planned to use in 

administering the survey. Based on the pretests, we made necessary 

changes to the survey prior to its nationwide implementation.



Survey Administration:



We administered the survey in three ways: mail, Internet, and as a 

portable document format (pdf) attachment sent out via E-mail. The 

respondents could submit their completed surveys through regular mail, 

fax, or the Internet. In addition to the survey itself, each survey 

package included two letters encouraging employees to participate in 

the survey administration. One letter was signed by the IRS 

Commissioner of the Small Business/Self Employed Division and the other 

was signed by GAO’s Managing Director of the Tax Administration and 

Justice team. We conducted at least two follow up calls to each 

nonrespondent in order to encourage a high response rate. A copy of the 

survey instrument is in appendix III.



Content Analysis:



Some of the survey questions were open-ended, allowing respondents an 

opportunity to provide thoughts and opinions in their own words. Of the 

350 employees that responded to our survey, 208 provided written 

responses to the open-ended questions. In order to categorize and 

summarize these responses, we performed a systematic content analysis 

of the open-ended responses. Two GAO analysts reviewed the responses 

and independently proposed categories. They met and reconciled these; 

each comment was then placed into one or more of the resulting 

categories, and agreement regarding each placement was reached between 

at least two analysts. All initial disagreements regarding placement 

into categories were discussed and reconciled. The numbers of responses 

in each content category were then summarized and tallied.



Case File Review Methodology:



To contribute to our understanding of IRS’s processing of section 1203 

cases and to determine the amount of time it takes to process the 

cases, we reviewed 92 of the 100 most recently closed cases that were 

recorded in IRS’s ALERTS database as of August 30, 2002. We developed a 

data collection instrument to record the type of allegation as well as 

various dates associated with key stages in the processing of the case. 

These key stages were identified as part of our review of the section 

1203 process and confirmed through discussions with IRS officials 

familiar with the processing of these cases.



Of the 100 cases that were identified in IRS’s database as being the 

most recently closed, we determined that 92 were available for review. 

For the 8 cases that were not available, IRS identified 3 as being 
duplicative, 

and we were advised by IRS not to include them in our review. In 

addition, according to IRS, 5 other cases were not available for review 

because the employee left IRS before TIGTA finished the investigation. 

(These cases were recorded as “not adjudicated.”) We performed a 

limited quality control check of the data recorded on 12 percent of the 

92 cases by randomly selecting the cases.



In addition, for 19 of the 92 cases, missing data prevented us from 

computing case processing times. As a result, processing times could 

only be calculated for 73 of the 92 cases included in this review.



Table 3 provides a breakdown of the number of cases opened before, on, 

or after March 1, 2002--the date that the new section 1203 process was 

implemented. All cases were closed after March 1, 2002.



Table 3: Number of Cases Opened before, on, or after March 1, 2002:



N=92[A]: Cases opened before 3/1/2002; Cases closed after 3/1/2002: 59.



N=92[A]: Cases opened on or after 3/1/2002; Cases closed after 3/1/

2002: 14.



N=92[A]: Total; Cases closed after 3/1/2002: 73.



Source: GAO analysis of IRS closed cases.



[A] 19 of the 92 cases were missing an opened or closed date.



[End of table]



The case processing times were calculated based on the dates that the 

case was opened by either TIGTA or IRS and closed by IRS. For the 

closing date, we used the date that the employee was issued a letter 

informing them of the outcome of his or her case. If there was no such 

letter, we used other documentation contained in the file that 

indicated the date that the case had been closed. In 5 of the cases, 

the employee had resigned or retired and the case file did not include 

a letter or other documentation to indicate the case had been closed. 

For these cases, we used the employees’ resignation or retirement date.



Our work was conducted in accordance with generally accepted government 

auditing standards.



[End of section]



Appendix II: Data on Section 1203 Allegations:



Tables 4, 5, and 6 summarize information on section 1203 allegations 

for the period July 1998 through 2002. Table 4 provides information on 

substantiated section 1203 allegations by disposition and table 5 

provides information on employee firings by type of misconduct and 

employee GS level. Table 6 provides a breakdown of results for the 

3,512 allegations that were investigated, including allegations that 

were substantiated as a section 1203 violation, allegations that were 

substantiated for nonsection 1203 misconduct, and allegations that were 

not substantiated.



Table 4: Summary of Substantiated Section 1203 Allegations by 

Disposition, July 1998 through September 2002:



Type of section 1203 misconduct: Taxpayer and employee rights; Firings: 

[Empty]; Resigned/: retired: [Empty]; Probation separation[A]: 

[Empty]; Fired: on other grounds[B]: [Empty]; Penalty mitigated: 

[Empty]; In personnel process[C]: [Empty]; Total: [Empty].



Type of section 1203 misconduct: False statement under oath; Firings: 

0; Resigned/: retired: 1; Probation separation[A]: 0; Fired: on other 

grounds[B]: 0; Penalty mitigated: 0; In personnel process[C]: 0; Total: 

1.



Type of section 1203 misconduct: Civil rights/constitutional rights; 

Firings: 0; Resigned/: retired: 0; Probation separation[A]: 0; Fired: 

on other grounds[B]: 1; Penalty mitigated: 0; In personnel process[C]: 

0; Total: 1.



Type of section 1203 misconduct: Falsifying or destroying documents; 

Firings: 3; Resigned/: retired: 5; Probation separation[A]: 1; Fired: 

on other grounds[B]: 0; Penalty mitigated: 0; In personnel process[C]: 

1; Total: 10.



Type of section 1203 misconduct: Assault or battery; Firings: 1; 

Resigned/: retired: 0; Probation separation[A]: 0; Fired: on other 

grounds[B]: 0; Penalty mitigated: 0; In personnel process[C]: 0; Total: 

1.



Type of section 1203 misconduct: Retaliation or harassment; Firings: 1; 

Resigned/: retired: 4; Probation separation[A]: 0; Fired: on other 

grounds[B]: 1; Penalty mitigated: 0; In personnel process[C]: 0; Total: 

6.



Type of section 1203 misconduct: Threat to audit for personal gain; 

Firings: 4; Resigned/: retired: 4; Probation separation[A]: 2; Fired: 

on other grounds[B]: 1; Penalty mitigated: 1; In personnel process[C]: 

0; Total: 12.



Type of section 1203 misconduct: Subtotal; Firings: 9; Resigned/: 

retired: 14; Probation separation[A]: 3; Fired: on other grounds[B]: 3; 

Penalty mitigated: 1; In personnel process[C]: 1; Total: 31.



Type of section 1203 misconduct: Compliance with federal tax laws; 

Firings: [Empty]; Resigned/: retired: [Empty]; Probation 

separation[A]: [Empty]; Fired: on other grounds[B]: [Empty]; Penalty 

mitigated: [Empty]; In personnel process[C]: [Empty]; Total: [Empty].



Type of section 1203 misconduct: Failure to timely file federal tax 

return; Firings: 55; Resigned/: retired: 90; Probation separation[A]: 

12; Fired: on other grounds[B]: 14; Penalty mitigated: 159; In 

personnel process[C]: 15; Total: 345.



Type of section 1203 misconduct: Understatement of federal tax 

liability; Firings: 7; Resigned/: retired: 13; Probation separation[A]: 

1; Fired: on other grounds[B]: 0; Penalty mitigated: 6; In personnel 

process[C]: 16; Total: 43.



Type of section 1203 misconduct: Subtotal; Firings: 62; Resigned/: 

retired: 103; Probation separation[A]: 13; Fired: on other grounds[B]: 

14; Penalty mitigated: 165; In personnel process[C]: 31; Total: 388.



Type of section 1203 misconduct: Total; Firings: 71; Resigned/: 

retired: 117; Probation separation[A]: 16; Fired: on other grounds[B]: 

17; Penalty mitigated: 166; In personnel process[C]: 32; Total: 419.



Source: GAO analysis of IRS data.



[A] Refers to the firing of an IRS employee during the first year of 

employment during the employee’s probationary period of employment.



[B] Refers to disciplinary firings for misconduct not related to 

section 1203.



[C] Refers to instances when an IRS deciding official has determined 

that a section 1203 allegation was substantiated and forwarded the case 

to the Executive Review Board for consideration.



Note: Dispositions for 8 of the 10 types of section 1203 misconduct are 

noted on this table. For the remaining 2 types of misconduct, 

allegations made against the employee were not substantiated.



[End of table]



Table 5: Summary of Employee Firings by Type of Misconduct and Employee 

GS-Level, July 1998 through September 2002:



Employee 

GS level: 02; Falsifying or destroying documents: 0; Assault or 

battery: 0; Retaliation or harassment: 0; Threat to audit for personal 

gain: 0; Failure to timely file federal tax return: 1; Understatement 

of federal tax liability: 0; Total: 1.



Employee 

GS level: 03; Falsifying or destroying documents: 0; Assault or 

battery: 0; Retaliation or harassment: 0; Threat to audit for personal 

gain: 0; Failure to timely file federal tax return: 7; Understatement 

of federal tax liability: 0; Total: 7.



Employee 

GS level: 04; Falsifying or destroying documents: 0; Assault or 

battery: 0; Retaliation or harassment: 0; Threat to audit for personal 

gain: 0; Failure to timely file federal tax return: 10; Understatement 

of federal tax liability: 2; Total: 12.



Employee 

GS level: 05; Falsifying or destroying documents: 0; Assault or 

battery: 0; Retaliation or harassment: 0; Threat to audit for personal 

gain: 1; Failure to timely file federal tax return: 7; Understatement 

of federal tax liability: 1; Total: 9.



Employee 

GS level: 06; Falsifying or destroying documents: 0; Assault or 

battery: 1; Retaliation or harassment: 0; Threat to audit for personal 

gain: 0; Failure to timely file federal tax return: 4; Understatement 

of federal tax liability: 1; Total: 6.



Employee 

GS level: 07; Falsifying or destroying documents: 0; Assault or 

battery: 0; Retaliation or harassment: 0; Threat to audit for personal 

gain: 1; Failure to timely file federal tax return: 8; Understatement 

of federal tax liability: 0; Total: 9.



Employee 

GS level: 08; Falsifying or destroying documents: 1; Assault or 

battery: 0; Retaliation or harassment: 1; Threat to audit for personal 

gain: 0; Failure to timely file federal tax return: 8; Understatement 

of federal tax liability: 2; Total: 12.



Employee 

GS level: 09; Falsifying or destroying documents: 1; Assault or 

battery: 0; Retaliation or harassment: 0; Threat to audit for personal 

gain: 0; Failure to timely file federal tax return: 2; Understatement 

of federal tax liability: 0; Total: 3.



Employee 

GS level: 10; Falsifying or destroying documents: 0; Assault or 

battery: 0; Retaliation or harassment: 0; Threat to audit for personal 

gain: 0; Failure to timely file federal tax return: 1; Understatement 

of federal tax liability: 0; Total: 1.



Employee 

GS level: 11; Falsifying or destroying documents: 0; Assault or 

battery: 0; Retaliation or harassment: 0; Threat to audit for personal 

gain: 1; Failure to timely file federal tax return: 2; Understatement 

of federal tax liability: 0; Total: 3.



Employee 

GS level: 12; Falsifying or destroying documents: 0; Assault or 

battery: 0; Retaliation or harassment: 0; Threat to audit for personal 

gain: 0; Failure to timely file federal tax return: 3; Understatement 

of federal tax liability: 1; Total: 4.



Employee 

GS level: 13; Falsifying or destroying documents: 0; Assault or 

battery: 0; Retaliation or harassment: 0; Threat to audit for personal 

gain: 1; Failure to timely file federal tax return: 2; Understatement 

of federal tax liability: 0; Total: 3.



Employee 

GS level: 14; Falsifying or destroying documents: 1; Assault or 

battery: 0; Retaliation or harassment: 0; Threat to audit for personal 

gain: 0; Failure to timely file federal tax return: 0; Understatement 

of federal tax liability: 0; Total: 1.



Employee 

GS level: Total; Falsifying or destroying documents: 3; Assault or 

battery: 1; Retaliation or harassment: 1; Threat to audit for personal 

gain: 4; Failure to timely file federal tax return: 55; Understatement 

of federal tax liability: 7; Total: 71.



Source: GAO analysis of IRS data.



Note: Firings for 6 of the 10 types of section 1203 misconduct are 

noted on this table. For the remaining 4 types of misconduct, an 

employee was not fired.



[End of table]



Table 6: Summary of Investigative Results, July 1998 through September 

2002:



Type of section 1203 misconduct: Taxpayer and employee rights; 

Investigative outcomes: Allegations: substantiated for: section 1203: 

misconduct: [Empty]; Investigative outcomes: Allegations: 

substantiated for non section 1203 misconduct: [Empty]; Investigative 

outcomes: Allegations not: substantiated: [Empty]; Investigative 

outcomes: Total investigations: [Empty].



Type of section 1203 misconduct: Seizure without approval; 

Investigative outcomes: Allegations: substantiated for: section 1203: 

misconduct: 0; Investigative outcomes: Allegations: substantiated for 

non section 1203 misconduct: 2; Investigative outcomes: Allegations 

not: substantiated: 11; Investigative outcomes: Total investigations: 

13.



Type of section 1203 misconduct: False statement under oath; 

Investigative outcomes: Allegations: substantiated for: section 1203: 

misconduct: 1; Investigative outcomes: Allegations: substantiated for 

non section 1203 misconduct: 3; Investigative outcomes: Allegations 

not: substantiated: 17; Investigative outcomes: Total investigations: 

21.



Type of section 1203 misconduct: Civil rights/constitutional rights; 

Investigative outcomes: Allegations: substantiated for: section 1203: 

misconduct: 1; Investigative outcomes: Allegations: substantiated for 

non section 1203 misconduct: 10; Investigative outcomes: Allegations 

not: substantiated: 251; Investigative outcomes: Total investigations: 

262.



Type of section 1203 misconduct: Falsifying or destroying documents; 

Investigative outcomes: Allegations: substantiated for: section 1203: 

misconduct: 10; Investigative outcomes: Allegations: substantiated for 

non section 1203 misconduct: 22; Investigative outcomes: Allegations 

not: substantiated: 34; Investigative outcomes: Total investigations: 

66.



Type of section 1203 misconduct: Assault or battery; Investigative 

outcomes: Allegations: substantiated for: section 1203: misconduct: 1; 

Investigative outcomes: Allegations: substantiated for non section 1203 

misconduct: 4; Investigative outcomes: Allegations not: substantiated: 

3; Investigative outcomes: Total investigations: 8.



Type of section 1203 misconduct: Retaliation or harassment; 

Investigative outcomes: Allegations: substantiated for: section 1203: 

misconduct: 6; Investigative outcomes: Allegations: substantiated for 

non section 1203 misconduct: 125; Investigative outcomes: Allegations 

not: substantiated: 1,549; Investigative outcomes: Total 

investigations: 1,680.



Type of section 1203 misconduct: Misuse of section 6103 to conceal 

information; Investigative outcomes: Allegations: substantiated for: 

section 1203: misconduct: 0; Investigative outcomes: Allegations: 

substantiated for non section 1203 misconduct: 0; Investigative 

outcomes: Allegations not: substantiated: 3; Investigative outcomes: 

Total investigations: 3.



Type of section 1203 misconduct: Threat to audit for personal gain; 

Investigative outcomes: Allegations: substantiated for: section 1203: 

misconduct: 12; Investigative outcomes: Allegations: substantiated for 

non section 1203 misconduct: 23; Investigative outcomes: Allegations 

not: substantiated: 42; Investigative outcomes: Total investigations: 

77.



Type of section 1203 misconduct: Subtotal; Investigative outcomes: 

Allegations: substantiated for: section 1203: misconduct: 31; 

Investigative outcomes: Allegations: substantiated for non section 1203 

misconduct: 189; Investigative outcomes: Allegations not: 

substantiated: 1,910; Investigative outcomes: Total investigations: 

2,130.



Type of section 1203 misconduct: Compliance with federal tax laws; 

Investigative outcomes: Allegations: substantiated for: section 1203: 

misconduct: [Empty]; Investigative outcomes: Allegations: 

substantiated for non section 1203 misconduct: [Empty]; Investigative 

outcomes: Allegations not: substantiated: [Empty]; Investigative 

outcomes: Total investigations: [Empty].



Type of section 1203 misconduct: Failure to timely file federal tax 

return; Investigative outcomes: Allegations: substantiated for: 

section 1203: misconduct: 345; Investigative outcomes: Allegations: 

substantiated for non section 1203 misconduct: 330; Investigative 

outcomes: Allegations not: substantiated: 239; Investigative outcomes: 

Total investigations: 914.



Type of section 1203 misconduct: Understatement of federal tax 

liability; Investigative outcomes: Allegations: substantiated for: 

section 1203: misconduct: 43; Investigative outcomes: Allegations: 

substantiated for non section 1203 misconduct: 281; Investigative 

outcomes: Allegations not: substantiated: 144; Investigative outcomes: 

Total investigations: 468.



Type of section 1203 misconduct: Subtotal; Investigative outcomes: 

Allegations: substantiated for: section 1203: misconduct: 388; 

Investigative outcomes: Allegations: substantiated for non section 1203 

misconduct: 611; Investigative outcomes: Allegations not: 

substantiated: 383; Investigative outcomes: Total investigations: 

1,382.



Type of section 1203 misconduct: Total; Investigative outcomes: 

Allegations: substantiated for: section 1203: misconduct: 419; 

Investigative outcomes: Allegations: substantiated for non section 1203 

misconduct: 800; Investigative outcomes: Allegations not: 

substantiated: 2,293; Investigative outcomes: Total investigations: 

3,512.



[End of table]



Source: GAO analysis of IRS data.



[End of section]



Appendix III: GAO Survey of IRS Frontline Enforcement Employees:



To determine IRS frontline enforcement employees’ perceptions of how 

section 1203 has affected their interactions with taxpayers, we 

surveyed a sample of IRS revenue officers, revenue agents, tax 

compliance officers, and tax auditors in the Small Business/Self 

Employed Division. We received 350 completed responses to our survey--

a response rate of 

77 percent. Note: Percentages may not add to 100 percent due to 

rounding. In addition, for survey questions 5 and 9, respondents who 

answered “not applicable to my job” were not included in our analysis 

of the results.



[See PDF for image]



[End of figure]



[End of section]



Appendix IV: Summary of Content Analysis of Open-Ended Comments from 
GAO 

Survey of IRS Frontline Enforcement Employees:



Some of the survey questions were open-ended, allowing respondents to 

provide thoughts and opinions in their own words. In order to 

categorize and summarize these responses, we performed a systematic 

content analysis of the open-ended responses. Two GAO analysts reviewed 

the responses and independently proposed categories. They met and 

reconciled these; each comment was then placed into one or more of the 

resulting categories, and agreement regarding each placement was 

reached between at least two analysts. All initial disagreements 

regarding placement into categories were discussed and reconciled. As 

shown in figure 7, the number of responses in each content category was 

then summarized and tallied.



Figure 7: Summary of Content Analysis of Open-Ended Written Responses:



[See PDF for image]



[End of figure]



[End of section]



Appendix V: Stages of Section 1203 Case Processing:



The following description of section 1203 case processing applies to 

all allegations, except those related to compliance with federal tax 

laws and employee and taxpayer civil rights, which are processed 

separately.[Footnote 36] Complaints involving allegations of section 

1203 misconduct are subject to a 3-stage process, including: (1) 

reporting and investigative determination, (2) fact-finding, and (3) 

adjudication. Figure 8 provides an illustration of the various stages 

of the processing of a section 1203 case.



Reporting and Investigative Determination:



Any taxpayer, taxpayer representative, or IRS employee can file a 

complaint with IRS or TIGTA alleging employee misconduct under section 

1203. IRS managers have been instructed to forward all allegations to 

TIGTA, which has primary responsibility for receiving and investigating 

complaints involving allegations of section 1203 misconduct. Once it 

receives the complaint, TIGTA is to enter information on the allegation 

into its information tracking system for managing and reporting 

purposes.



After entering the information into its information system, TIGTA is to 

make an initial determination about whether the allegation should be 

investigated as a potential act of employee misconduct. If TIGTA finds 

sufficient information indicating a section 1203 violation may have 

occurred, TIGTA is to investigate the allegation. Similarly, TIGTA may 

find sufficient grounds to conduct an investigation for misconduct 

unrelated to section 1203. In either case, the results of the TIGTA 

investigation are provided to IRS as a formal Report of Investigation.



TIGTA may also determine that the complaint does not contain specific 

enough information, or that it does not have the necessary expertise, 

to be able to make a determination on the complaint’s investigative 

merit. In these instances, TIGTA is to refer the complaint to the 

Commissioner’s Complaint Processing and Analysis Group (CCPAG) to 

determine whether there is a basis for an investigation. A case 

development team within CCPAG is to receive the allegation and enter 

information on the allegation into its information tracking system. The 

role of the case development team is to gather the relevant facts 

related to the allegation to determine whether the essential elements 

of a section 1203 violation may be present.



Upon its evaluation of the allegation, CCPAG may conclude that the 

complaint is frivolous (e.g., a taxpayer alleges misconduct because the 

employee did not agree with the taxpayer that the tax laws are 

unconstitutional). In these instances, CCPAG is to forward the 

allegation to IRS’s Frivolous Return Program at the Ogden Service 

Center.[Footnote 37]



After gathering the relevant information--for allegations not 

considered frivolous--CCPAG is to forward the allegation to the Board 

of Employee Professional Responsibility (BEPR) for its review. BEPR 

includes the Director, CCPAG, and representatives from the Small 

Business and Self Employed Division. IRS’s Strategic Human Resources 

and Agency-Wide Shared Services employee relations specialists and 

Office of Chief Counsel General Legal Services may serve as advisors to 

BEPR. TIGTA also serves in an advisory role on BEPR. IRS’s Senior 

Counselor to the IRS Commissioner participates in BEPR’s review of 

allegations involving IRS executives, GS-15’s and senior manager pay 

band employees.



BEPR’s review may result in several outcomes. Specifically, BEPR may 

concur with the case development team’s finding that the allegation has 

no merit. In this situation, no investigation is conducted and the 

Director CCPAG is to issue a letter to the employee and his/her manager 

advising that there will be no investigation. If BEPR concurs with the 

case development team’s findings that no misconduct occurred, the 

Director of CCPAG is to issue a clearance letter to the employee and 

his/her manager. The case is then closed. If BEPR concurs with the case 

development team’s findings that other misconduct may have occurred, 

BEPR is to recommend a referral to TIGTA or IRS management for 

investgation, and regular disciplinary procedures are to 

apply.[Footnote 38] If BEPR agrees with the case development team’s 

findings that section 1203 misconduct may have occurred, BEPR is to 

recommend a referral to TIGTA for investigation.



Fact-Finding:



Once TIGTA or BEPR determines an allegation to have investigative merit 

as a possible section 1203 violation, TIGTA is to perform the 

investigation. Specifically, TIGTA may review records, interview 

witnesses, and consult technical experts as necessary to develop 

information relevant to the alleged violation. In some cases, the 

possible section 1203 misconduct may also be a potential violation of 

criminal law. In these cases, TIGTA is to refer its findings to a local 

U.S. Attorney Office for consideration of criminal prosecution. After 

the investigation is completed, and a referral is made to a U.S. 

Attorney, if appropriate, TIGTA is to provide a Report of Investigation 

to CCPAG.



Adjudication:



All TIGTA Reports of Investigation on allegations of section 1203 

violations are first to be reviewed by CCPAG to determine whether the 

evidence can support the allegation for a section 1203 violation. If 

CCPAG determines that the evidence does not support a section 1203 

violation or other misconduct unrelated to section 1203, the Director 

of CCPAG is to issue a clearance letter to the employee and his/her 

manager. If CCPAG determines that the evidence presented supports a 

section 1203 violation, it is to forward the Report of Investigation to 

the “proposing official”--a management official generally two levels of 

supervision above the subject of the allegation--for further action.



Acting with the advice of an employee relations specialist, the 

proposing official is to determine whether misconduct has been 

substantiated by a preponderance of the evidence. If the proposing 

official determines that no misconduct occurred, the official is to 

issue a clearance letter to the employee. If this official determines 

that the evidence supports misconduct unrelated to section 1203, IRS’s 

regular disciplinary procedures are to apply.[Footnote 39] If this 

official determines that the specific elements of a section 1203 

violation appear to be established by a preponderance of the evidence, 

he or she is to issue a letter to the employee proposing removal from 

the federal service. The employee has the right to respond to this 

proposal letter and to review any information relied upon by the 

proposing official. The case is to be submitted to the deciding 

official, generally an executive at least three levels of supervision 

above the employee.



The deciding official is to review the entire case file, including the 

employee’s response, to determine whether the charge has been proved. 

If the deciding official determines that no misconduct occurred, the 

official is to issue a clearance letter to the employee. If this 

official determines that the evidence supports misconduct unrelated to 

section 1203, IRS’s regular disciplinary procedures are to apply. If 

the deciding official determines that a section 1203 violation is 

established by a preponderance of the evidence, the employee is to be 

removed from the federal service, unless the Commissioner of Internal 

Revenue decides that another penalty is to be imposed.



The Commissioner of Internal Revenue has established a Section 1203 

Review Board (Board) to consider all cases in which a deciding official 

finds that a section 1203 violation has occurred. Comprised of various 

IRS executives from different IRS units, the board must review the 

allegation to determine whether a penalty less than firing the employee 

is appropriate.[Footnote 40] If the Board does not find mitigation to 

be appropriate, the case is not submitted to the IRS Commissioner. The 

case is then returned to the deciding official who is to impose the 

statutory penalty of termination of employment. If the Board recommends 

mitigation, the Commissioner reviews the recommendation. If the 

Commissioner mitigates the penalty, other disciplinary actions, such as 

written counseling, admonishment, reprimand, or suspension, may be 

applied. The Commissioner’s decision on the level of discipline to be 

imposed is not subject to review outside IRS. After the Commissioner’s 

decision, the employee may appeal the finding that a violation 

occurred.



Figure 8: Case Flow Process for Section 1203 Cases:



[See PDF for image]



Note: BEPR-Board of Employee Professional Responsibility; CCPAG-

Commissioner’s Complaint Processing and Analysis Group; DO-deciding 

official; IRS-Internal Revenue Service; PO-proposing official; ROI-

Receipt of Investigation; TIGTA-Treasury Inspector General for Tax 

Administration:



[End of figure]



[End of section]



Appendix VI: Comments from the Internal Revenue Service:



DEPARTMENT OF THE TREASURY INTERNAL REVENUE SERVICE WASHINGTON, D.C. 

20224:



COMMISSIONER:



February 6, 2003:



Mr. James R. White Director, Tax Issues United States General 

Accounting Office Washington, D.C. 20548:



Dear Mr. White:



I reviewed your report titled “IRS and TIGTA Should Evaluate Their 

Processing of Employee Misconduct under Section 1203,” GAO-03-394. In 

recognition of the profound affect that Section 1203 has had on some of 

our employees, we are continually evaluating every aspect of the 

program and, in particular, striving to improve the way in which we 

process 1203 cases. Indeed, this evaluation has led to a number of 

administrative improvements and has also yielded insights that led to 

the 1203 legislative proposal in the President’s budget.



I believe the most effective response to the issues you highlighted in 

your report would be enactment of the legislative proposal. The changes 

proposed clarify several aspects of Section 1203, and authorize the 

Commissioner of Internal Revenue to establish guidelines for imposing 

penalties other than termination of employment. These guidelines would 

also address some of the recurring fact patterns in cases that the 

Commissioner must now personally review, but that clearly do not 

warrant firing the employee. Other proposed changes to Section 1203 

narrow its application by eliminating offenses related to employee 

rights and late filed tax returns when a refund is owed. Enacting this 

legislation would help restore our employees’ confidence that they will 

be treated fairly, while ensuring that we appropriately deal with the 

very small number of egregious acts of misconduct.



As your report makes clear, employees continue to express significant 

concern that their jobs are in jeopardy whenever a taxpayer complains. 

We have addressed this issue through Commissioner speeches, videos and 

all employee messages, as well as by publicizing statistics and case 

results. Despite assurances that employee rights will be fully 

protected and that no employee will be fired for an innocent mistake, 

your survey results show that fear of Section 1203 allegations remains 

a significant issue for our front-line employees. I do not believe 

additional training and publicity will allay that fear. The correct 

response to the employee concerns is to enact the legislative proposal.



Our response to your recommendation is enclosed. If you have questions, 

please call Stephen Whitlock at (202) 622-6383.



Sincerely,



Bob Wenzel:



Acting Commissioner:



Signed by Bob Wenzel:



Enclosure:



RECOMMENDATION: The Commissioner of Internal Revenue and Treasury 

Inspector General for Tax Administration jointly establish and 

implement a plan for a coordinated evaluation of the Section 1203 

process. In establishing this system, IRS and TIGTA also should develop 

(1) results oriented goals for processing 1203 cases, (2) performance 

measures that are balanced and can be used to assess progress towards 

those goals, and (3) methods for collecting and analyzing performance 

data related to the goals and measures.



RESPONSE: The IRS and the Treasury Inspector General for Tax 

Administration (TIGTA) share responsibility for implementing Section 

1203. We and TIGTA have taken steps to improve the process for 

investigating and evaluating allegations against employees, including a 

significant process reengineering that we implemented in March 2002. We 

agree that coordinated evaluation is desirable, but TIGTA’s 

independence makes it inappropriate for us to oversee its performance. 

We will establish a baseline for timely action on allegations, now that 

the process we established in March 2002 has been stabilized, with 

specific goals based on that baseline data. We will continue to monitor 

employee attitudes through surveys and focus groups, so that we can 

identify steps to further address employee concerns about Section 

1203.We will use the results of the GAO survey as the baseline for 

assessing improvements in employee attitudes.



[End of section]



Appendix VII: Comments from the Treasury Inspector General for Tax 

Administration:



DEPARTMENT OF THE TREASURY WASHINGTON, D.C. 20005:



INSPECTOR GENERAL for TAX ADMINISTRATION:



February 6, 2003:



Mr. James R. White Director, Tax Issues U.S. General Accounting Office 

Washington, DC 20548:



Dear Mr. White,



We have reviewed the report concerning the Internal Revenue Service 

(IRS) and the Treasury Inspector General for Tax Administration’s 

(TIGTA) processing of alleged §1203 violations. This report is entitled 

Tax Administration: IRS and TIGTA Should Evaluate Their Processing of 

Employee Misconduct under Section 1203, (GAO-03-394). We appreciate the 

opportunity to comment on the audit and associated report.



The overall objective of this audit was to assess the implementation of 

the Internal Revenue Service Restructuring and Reform Act of 1998 

(RRA98) § 1203. The audit objectives included the following:



(1) to determine the number, type and disposition of section 1203 

allegations; (2) determine the frontline enforcement employees’ 

perceptions of how section 1203 has affected their interactions with 

taxpayers; and (3) identify what problems, if any, IRS and TIGTA have 

encountered in processing section 1203 cases and the extent to which 

they have addressed them.



Your audit notes that the IRS and TIGTA made changes to address 

problems with the process for receiving, investigating, and 

adjudicating § 1203 allegations. One of the changes instituted in March 

2002, streamlined the § 1203 process by requiring that all §1203 

allegations except those allegations related to employee tax 

compliance, i.e.,



§§ 1203(b)(8) and 1203(b)(9), are reported directly to TIGTA. The IRS 

and TIGTA also created the Board of Employee Professional 

Responsibility to ensure that 1203 allegations are promptly 

investigated and adjudicated.



The audit makes the following recommendation:



Recommendation: The Commissioner of Internal Revenue and the Treasury 

Inspector General for Tax Administration jointly establish and 

implement a plan for a coordinated evaluation system of the section 

1203 process. In establishing this system, IRS and TIGTA also should 

develop (1) results-oriented goals for processing section 1203 cases, 

(2) performance measures that are balanced and can be used to assess 

progress towards those goals, and (3) methods for collecting and 
analyzing 

performance data related to the goals and measures.



While TIGTA philosophically understands the desire to have a jointly 

established and implemented plan for a coordinated evaluation system of 

the 1203 process, there are legislative challenges in meeting this 

objective. The RRA98 amendments to the Inspector General Act of 1978 

(IG Act) created TIGTA as an independent IG with structural and actual 

autonomy from the IRS. TIGTA has independently established goals, 

performance measures, and methods for analyzing performance data for 

all TIGTA investigations, including section 1203 cases. TIGTA 

understands that the IRS is in the process of establishing a system to 

ensure the timely adjudication of section 1203 cases. In addition, as 

noted earlier, the IRS and TIGTA made changes to the §1203 process to 

ensure that all § 1203 cases are investigated and adjudicated in a 

timely manner. TIGTA will continue to effectively manage investigations 

of § 1203 allegations and TIGTA will work with the IRS to ensure the 

1203 process is operating efficiently and effectively.



Thank you for the opportunity to review and comment on your draft 

report and recommendation regarding the handling and processing of 

§1203 allegations. Also please allow me to express my appreciation to 

you and your staff for their work done in this area.



If you need any further information regarding this matter, please do 

not hesitate to call me or a member of your staff may call Tim Camus, 

Special Agent in Charge, Operations Division, at (202) 927-7234.



Sincerely,



Pamela J. Gardiner Acting Inspector General:



Signed by Pamela J. Gardiner:



[End of section]



Appendix VIII: GAO Contacts and Staff Acknowledgments:



GAO Contacts:



James R. White (202) 512-9110

Thomas Short (202) 512-9110:



Staff Acknowledgments:



In addition to the persons named above, the following persons made key 

contributions to this report: Kevin Dooley, Evan Gilman, Patty Hsieh, 

Shirley Jones, Stuart Kaufman, Anne Laffoon, MacDonald Phillips, 

Kristen Plungas, Brenda Rabinowitz, Anne Rhodes-Kline, Andrea Rogers, 

Wendy Turenne, and Chris Wetzel.



As discussed in appendix I, we focused on the last 100 cases closed 

rather than those started after March 2002 and closed by August 2002 

because most of the investigations under the old process took well 

beyond 6 months to close. We were unable to use 8 cases because of 

files that were a duplicate or that could not be located. Further, 19 

case files did not include enough information on time spent. Our 

analysis of the remaining 73 cases showed that section 1203 case 

processing times ranged from 22 days to 1155 days. Also, 

59 of the cases opened before and 14 opened after March 1, 2002--the 

date that the new section 1203 process took effect.



FOOTNOTES



[1] P.L. 105-206. 



[2] According to IRS, an allegation is considered “substantiated” if 

the investigation develops information sufficient to support the 

allegation, thereby resulting in a violation.



[3] According to IRS, the firing and mitigated penalty data presented 

throughout this report do not include the results of any third party 

appeals. 



[4] The sampling errors (confidence limits) for all survey percentages 

do not exceed plus or minus 10 percentage points, unless otherwise 

shown as footnotes to the report text. 



[5] These laws are: (1) Title VI or VII of the Civil Rights Act of 

1964; (2) Title IX of the Education Amendments of 1972; (3) the Age 

Discrimination in Employment Act of 1967;

(4) the Age Discrimination Act of 1975; (5) Section 501 or 504 of the 

Rehabilitation Act of 1973; or (6) Title I of the Americans with 

Disabilities Act of 1990. IRS Reform Act section 1203(b)(3)(B).



[6] Section 6103 of the Internal Revenue Code governs the protection of 

tax data, which are confidential, from unauthorized disclosure and use. 





[7] The ETC unit is to refer employee tax issues that it cannot resolve 

to IRS management for additional fact-finding. TIGTA may investigate 

employee tax compliance allegations that are identified independent of 

the ETC unit.



[8] The Discrimination Complaint Review Unit is to assess EEO 

settlement agreements and discrimination findings to determine 

potential section 1203 misconduct. The External Civil Rights Unit is to 

investigate complaints from taxpayers or taxpayer representatives about 

being excluded from, denied the benefits of, or subjected to 

discrimination in an IRS program or activity. TIGTA may also 

investigate civil rights allegations involving some types of sexual 

harassment. 



[9] Factors included the nature, notoriety, and seriousness of the 

offense; the employee’s work record; and the impact of the offense on 

confidence in the employees’ ability to perform their duties.



[10] According to IRS and TIGTA officials, only a small percentage of 

TIGTA cases are not included in IRS’s database. 



[11] As one of four operating divisions, SB/SE was established in 

October 2000 to serve the needs of self-employed individuals as well as 

businesses with assets of up to $10 million or less. 



[12] As discussed in appendix I, we dropped 45 survey respondents from 

our initial sample of 500 because those employees reported that they 

did not have regular contact with taxpayers.



[13] For context, IRS’s frontline enforcement employees interacted with 

tens of millions of individual taxpayers from 1998 to 2002, and some 

portion (which is not known) of the 3,970 allegations were made by IRS 

employees rather than taxpayers.



[14] See appendix III for more detailed survey results.



[15] See appendix III for more detailed survey results.



[16] Another estimated 27 percent of the employees said they are 

somewhat or very confident that they would not be disciplined for 

making an honest mistake. 



[17] As noted in appendix I, because our sample was designed to produce 

precise estimates for a nationwide sample of enforcement employees, we 

did not do any analyses by type of employee.



[18] For example, between fiscal years 1998 and 2001, the number of 

levies and seizures decreased 73 percent and 90 percent, respectively. 

Over the same time, the rate at which IRS audited individual tax 

returns declined from 0.99 percent to 0.58 percent.



[19] See appendix III for more detailed survey results.



[20] Under the Internal Revenue Code, “levy” is the seizure of taxpayer 

assets, including bank accounts, wages, and other property possessed by 

third parties, such as banks or employers. A “lien” is a legal claim 

attached to property to secure payment of a debt.



[21] See appendix III for more detailed survey results.



[22] Collection employees also might take some of these actions when 

trying to collect unpaid taxes.



[23] Since the Restructuring Act, IRS has been in the midst of a major 

reorganization, and complex tax laws have been changing annually. For 

information see, U.S. General Accounting Office, IRS Restructuring Act: 

Implementation Under Way but Agency Modernization Important to Success, 

GAO/T-GGD-00-53 (Washington, D.C.: Feb. 2, 2000) and Tax 

Administration: IRS’s Implementation of the Restructuring Act’s 

Taxpayer Protection and Rights Provision, GAO/GGD-00-85 (Washington, 

D.C.: Apr. 28, 2000).



[24] See appendix III for more detailed survey results.



[25] See appendix III for more detailed survey results.



[26] IRS’s limited review involved 35 cases. 



[27] Booz-Allen & Hamilton, Inc., Section 1203 Complaint Process 

Reengineering; December 21, 2001. Addendum to Final Report, Section 

1203 Complaint Process Reengineering; January 22, 2002.



[28] The study did not examine the section 1203 process for allegations 

involving the tax compliance provisions of section 1203.



[29] We did not assess the new process since it took effect during the 

course of our work.



[30] We are reporting on problems that the team identified and for 

which recommendations were made by the team or actions were taken by 

IRS to address the problems. Other problems included IRS managers 

lacking skill to perform adjudications and inadequate training for 

managers and employees on section 1203. 



[31] As we discuss in greater detail in appendix V, BEPR is comprised 

of IRS SB/SE and other officials.



[32] Exceptions include some employee tax compliance and civil rights 

allegations, since other units within IRS have primary responsibility 

for investigating these types of allegations.



[33] See our work on IRS’s performance goals and measures, such as U.S. 

General Accounting Office, Tax Administration: IRS’s Innocent Spouse 

Program Performance Improved; Balanced Performance Measures Needed, 

GAO-02-558 (Washington, D.C.: Apr. 24, 2002); Tax Administration: IRS 

Should Evaluate the Changes to its Offers in Compromise Program, 

GAO-02-311 (Washington, D.C.: Mar. 15, 2002); and Political 

Organizations: Data Disclosure and IRS’ Oversight of Organization 

Should Be Improved, GAO-02-444, (Washington D.C. July 17, 2002).



[34] Three balanced measures--customer service, employee satisfaction, 

and business results--are to be considered when establishing goals and 

evaluating performance. For the section 1203 process, the measures 

could balance service provided to those making allegations, the 

satisfaction of IRS employees involved, and results such as the 

timeliness and quality of the process. 



[35] As discussed in appendix I, we focused on the last 100 cases 
closed

rather than those started after March 2002, and closed by August 2002 

because most of the investigations under the old process took well 
beyond

6 months to close. We were unable to use 8 cases because of files that 

were a duplicate or that could not be located. Further, 19 case files 

did not include enough information on time spent. Our analysis of the 

remaining 73 cases showed that section 1203 case processing times 
ranged 

from 22 days to 115 days. Also, 59 of the cases opened before and 14 

opened after March 1, 2002--the date that the new section 1203 process 

took effect. 



[36] As discussed earlier in this report, IRS’s Employee Tax Compliance 

unit is responsible for identifying and investigating employees who 

appear to have tax compliance problems. IRS’s Office of Equal 

Employment Opportunity is responsible for reviewing and analyzing EEO 

settlement agreements, findings of discrimination, and taxpayer 

complaints of discrimination to determine whether a potential section 

1203 violation exists. However, under certain circumstances, TIGTA may 

also investigate allegations related to compliance with federal tax 

laws and employee and taxpayer civil rights. 



[37] The Frivolous Return Program is responsible for identifying the 

tax returns of individuals who assert unfounded legal or constitutional 

arguments and refuse to pay their taxes or to file a proper tax return. 

The program also identifies returns claiming frivolous refunds, such as 

those involving slavery reparations. 



[38] The regular disciplinary process is codified at 5 U.S.C. Chapter 

43 on unacceptable performance and 5 U.S.C. Chapter 75 on adverse 

actions.



[39] The discipline imposed may range from oral counseling to 

termination of employment, depending on the nature and severity of the 

misconduct, the employee’s work record, and other factors.



[40] The Deputy Commissioner is designated as the Board Chairman, but 

he is serving as the Acting Commissioner of Internal Revenue at this 

time, and in this role must consider the recommendations of the Board. 

Current members of the Board are the Assistant Deputy Commissioner, who 

serves as Acting Chairman, the Deputy National Taxpayer Advocate, the 

National Director for Equal Opportunity and Diversity, and the Deputy 

Commissioner of the Large and Midsized Business Division. In addition, 

the Director of CCPAG serves as Executive Director for the Board, 

presenting case files for consideration and maintaining records of the 

Board’s activities. Agency-Wide Shared Services employee relations 

specialists assemble case files for the Board, and a representative of 

the Office of Chief Counsel attends and participates in all Board 

meetings.



GAO’s Mission:



The General Accounting Office, the investigative arm of Congress, 

exists to support Congress in meeting its constitutional 

responsibilities and to help improve the performance and accountability 

of the federal government for the American people. GAO examines the use 

of public funds; evaluates federal programs and policies; and provides 

analyses, recommendations, and other assistance to help Congress make 

informed oversight, policy, and funding decisions. GAO’s commitment to 

good government is reflected in its core values of accountability, 

integrity, and reliability.



Obtaining Copies of GAO Reports and Testimony:



The fastest and easiest way to obtain copies of GAO documents at no 

cost is through the Internet. GAO’s Web site ( www.gao.gov ) contains 

abstracts and full-text files of current reports and testimony and an 

expanding archive of older products. The Web site features a search 

engine to help you locate documents using key words and phrases. You 

can print these documents in their entirety, including charts and other 

graphics.



Each day, GAO issues a list of newly released reports, testimony, and 

correspondence. GAO posts this list, known as “Today’s Reports,” on its 

Web site daily. The list contains links to the full-text document 

files. To have GAO e-mail this list to you every afternoon, go to 

www.gao.gov and select “Subscribe to daily E-mail alert for newly 

released products” under the GAO Reports heading.



Order by Mail or Phone:



The first copy of each printed report is free. Additional copies are $2 

each. A check or money order should be made out to the Superintendent 

of Documents. GAO also accepts VISA and Mastercard. Orders for 100 or 

more copies mailed to a single address are discounted 25 percent. 

Orders should be sent to:



U.S. General Accounting Office



441 G Street NW,



Room LM Washington,



D.C. 20548:



To order by Phone: 	



	Voice: (202) 512-6000:



	TDD: (202) 512-2537:



	Fax: (202) 512-6061:



To Report Fraud, Waste, and Abuse in Federal Programs:



Contact:



Web site: www.gao.gov/fraudnet/fraudnet.htm E-mail: fraudnet@gao.gov



Automated answering system: (800) 424-5454 or (202) 512-7470:



Public Affairs:



Jeff Nelligan, managing director, NelliganJ@gao.gov (202) 512-4800 U.S.



General Accounting Office, 441 G Street NW, Room 7149 Washington, D.C.



20548: