Statement of Principles of Internal Revenue Tax Administration

The function of the Internal Revenue Service is to adm i n i ster the Internal Revenue Code. Tax policy for raising re v e n u e is determined by Congre s s .

With this in mind, it is the duty of the Service to carry out that policy by correctly applying the laws enacted by Congress; to determine the reasonable meaning of various Code provisions in light of the Congressional purpose in enacting them; and to perform this work in a fair and impartial manner, with neither a government nor a taxpayer point of view.

At the heart of administration is interpretation of the Code. It is the responsibility of each person in the Service, charged with the duty of interpreting the law, to try to find the true meaning of the statutory provision and not to adopt a strained construction in the belief that he or she is “protecting the revenue.” The revenue is properly protected only when we ascertain and apply the true meaning of the statute.

ucts and services; and perf o rm in a manner warr a n t i n g the highest degree of public confidence in our integrity, eff ic i e n c y, and fairn e s s .

The Service also has the responsibility of applying and administering the law in a reasonable, practical manner. Issues should only be raised by examining officers when they have merit, never arbitrarily or for trading purposes. At the same time, the examining officer should never hesitate to raise a meritorious issue. It is also important that c a re be exercised not to raise an issue or to ask a court to adopt a position inconsistent with an established Serv i c e p o s i t i o n .

Administration should be both reasonable and vigorous. It should be conducted with as little delay as possible and with great courtesy and considerateness. It should never t ry to overreach, and should be reasonable within the bounds of law and sound administration. It should, howeve r, be vigorous in requiring compliance with law and it should be relentless in its attack on unreal tax devices and f r a u d .

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