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8.7.1.9
(11-06-2007)
Cases Involving Criminal Prosecution and Restrictions on Appeals Jurisdiction in Criminal Cases
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Appeals does not act on civil liability in a pending criminal prosecution case without concurrence of Criminal Investigation.
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In any case in which prosecution for criminal fraud is recommended to the DOJ, or in which the question of liability for criminal
fraud remains under investigation, treat criminal prosecution as pending until a final disposition is made on the criminal
aspects. IRM Part 4 and the Policies of the Internal Revenue Service Handbook, contain text relative to cases with criminal
fraud implications.
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Appeals may act on civil liability when notified in writing by Criminal Investigation that:
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Recommended criminal prosecution was declined and no court proceedings will be instituted; or
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All court proceedings which were instituted as the result of the recommendation for criminal prosecution are complete.
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Appeals may act on civil liability when court proceedings on criminal prosecution are not fully completed, but only if the Department of
Justice has given clearance for a determination or a settlement, in whole or in part.
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Under Policy Statement P-4-26, Appeals takes no action that would imperil successful criminal investigation or prosecution.
In cases where Criminal Investigation did not recommend criminal prosecution but the case is pending with the DOJ, or an indictment
was, in fact, returned charging attempt to evade or defeat tax or willful failure to file a return, coordinate with Criminal
Investigation on intended action in the case. Criminal Investigation, in coordination with the DOJ, is better able to determine
whether contemplated Appeals action on the case is contrary to the Government's interests in the criminal case.
8.7.1.9.1
(11-06-2007)
Appeals Jurisdiction in Criminal Cases
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The notice of Criminal Investigation referred to above releases Appeals from the restriction to act on criminal cases imposed
by Delegation Order No. 66, as revised. However, the notice received from Criminal Investigation in pending criminal cases
may have limitations or qualifications. Appeals authority is subject to any of these restrictions.
8.7.1.9.1.1
(11-06-2007)
Appeals Case Memo or Status Report on Pending Criminal Case
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State in the Appeals Case Memo (ACM) that there are criminal aspects in the case and indicate whether or not such aspects
were completed.
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If Criminal Investigation's notice of clearance is prior to the completion of final criminal action and:
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Appeals action is completed within 45 days from the date of notice, give Criminal Investigation four extra copies of the Appeals
Case Memo.
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Appeals action is not completed within 45 days from the date of notice, forward a status report (with four copies) at the
end of that period to Criminal Investigation and send a similar report every 30 days until completion. Document the Status
Report with any lack of cooperation or good faith on the part of the taxpayer or taxpayer's Counsel. Upon completion, give
the Appeals Case Memo (with four extra copies) to Criminal Investigation.
8.7.1.9.2
(11-06-2007)
Report to Criminal Investigation When Convicted Taxpayer on Probation
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Appeals may consider the civil liability of a taxpayer convicted of violating the internal revenue laws and placed on probation
for a specified period of time conditioned upon satisfactory settlement and/or payment of civil liability for taxes and penalties.
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Promptly inform the Special Agent in Charge, Criminal Investigation for the originating field office of any lack of cooperation,
or any other act of the taxpayer, that appears intended to delay or to interfere with an orderly determination of liability.
Also, give a Status Report on the case to the Special Agent in Charge, Criminal Investigation, no later than 60 days before
the expiration of the probationary period or upon completion of the case, whichever occurs first.
8.7.1.9.3
(11-06-2007)
Civil Liabilities After Criminal Aspects Closed
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After disposition of criminal aspects of a case, the administrative file is forwarded to Appeals for consideration of any
unsettled civil liabilities within its jurisdiction.
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The closed enforcement file received by Appeals reveals any additional facts or evidence obtained by Criminal Investigation
or developed in any pretrial investigation by a special agent. It also reveals whether or not the case was tried. If tried,
or if additional evidence was developed, there is a special agent's summary report, prepared in accordance with instructions
in IRM Part 9. If the file does not contain the required report, request it from the area Criminal Investigation function.
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Include a concise statement in the ACM about the joint investigation by a special agent and revenue agent, the results, and
the disposition of any recommendations for criminal prosecution.
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