Fair and Accountable IRS Reviews Act
Key claim: The Fair and Accountable IRS Reviews Act requires that an IRS employee’s immediate supervisor—defined as the person to whom the employee reports—must give written approval of certain federal tax penalties before any related written communication is sent to the taxpayer.
Abstract
(HR5346 · 119th Congress) Fair and Accountable IRS Reviews Act This bill provides that an Internal Revenue Service (IRS) employee’s immediate supervisor for purposes of approving certain federal tax penalties is the person to whom such employee reports. The bill also provides that an immediate supervisor’s approval of certain federal tax penalties must be obtained (in writing) before any written communication related to such penalties is sent to the taxpayer. As background, current law requires that the initial determination by an IRS employee to assess certain federal tax penalties be approved (in writing) by such employee’s immediate supervisor (or a designated higher-level official). Under IRS regulations, an immediate supervisor is any individual with responsibility to review another individual’s proposed federal tax penalties (without such proposal being subject to an intermediary’s approval). The IRS regulations also establish requirements for when such approval must be obtained based on whether the federal tax penalty is subject to pre-assessment review or raised in Tax Court proceedings. Latest action (2025-12-02): Received in the Senate and Read twice and referred to the Committee on Finance.
Why this matters
Supervisor-approval requirements for IRS penalties are a key procedural safeguard for taxpayers, and disputes over when approval must occur and who counts as the ‘immediate supervisor’ have driven significant Tax Court litigation. By codifying that the approving supervisor is the person to whom the employee directly reports and requiring written approval before any penalty-related communication is sent, the bill would shift procedural burdens onto the IRS and potentially reduce penalties assessed against taxpayers whose cases involve procedural defects.