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Samuel Lapin Quoted on IRS Chief Counsel FAQ Process in Tax Notes

"Clarification of IRS Chief Counsel FAQ Role Provides Certainty"

Tax Notes

Samuel Lapin discussed an Internal Revenue Service (IRS) Chief Counsel notice regarding its new procedures for issuing significant or fact sheet FAQs in Tax Notes. The notice identifies which attorneys coordinate the process and elaborates on when the IRS may issue significant FAQs. The notice issued June 30 contains draft provisions that will make their way into the chief counsel directives portion of the Internal Revenue Manual (IRM). That section will include the procedures for the review and issuance of fact sheet FAQs provided for in guidance released in October 2021 (IR-2021-202). Lapin said the IRS's attempt to be transparent with the release of the newest guidance about its FAQ processes is welcome. The notice is largely consistent with the October 2021 release, but it's reassuring to see the penalty reliance provision reiterated. Lapin also pointed out that the notice is purely prospective and does not address the treatment of older FAQs. He also noted the notice's elaboration on when the IRS may issue fact sheet FAQs, identifying certain emerging issues as an area not mentioned in the October 2021 guidance. Other questions arise when considering IRS FAQ practices in light of the agency's recent losses on Administrative Procedure Act compliance, such as in CIC Services v. IRS, according to Lapin. He wondered whether the IRS is considering soliciting comments on FAQs as a matter of course, especially considering the archiving infrastructure. The agency might also consider formalizing more FAQs, as it did for the employee retention credit guidance, he said.