collected, the lowest rate of any nation in the world. To protect this high level of compliance, the Service maintains an effective enforcement program, strengthened by continued conversion to the ADP Master File system. General and special funds: About 97% of the revenue collected each year comes from what people themselves report on their tax returns and from withholding. This high level of voluntary compliance allows Internal Revenue to collect more than $100 billion at a cost of less than 50 cents for every $100 SALARIES AND EXPENSES For necessary expenses of the Internal Revenue Service, not otherwise provided for, including executive direction, administrative support, and internal audit and security; hire of passenger motor vehicles; and services as authorized by section 15 of the Act of August 2, 1946 (5 U.S.C. 55a), and of expert witnesses at such rates as may be determined by the Commissioner; [$15,850,000] $18,120,000. (5 U.S.C. 133; Title 26 U.S.C.; 60 Stat. 810; Treasury Department Appropriation Act, 1965.) Program and Financing (in thousands of dollars) REVENUE ACCOUNTING AND PROCESSING For necessary expenses of the Internal Revenue Service for processing tax returns, and revenue accounting; hire of passenger motor vehicles; and services as authorized by section 15 of the Act of August 2, 1946 (5 U.S.C. 55a), and of expert witnesses at such rates as may be determined by the Commissioner, including not to exceed $17,500,000 for temporary employment and not to exceed $1,000 for salaries of personnel engaged in pre-employment training of card punch operator applicants; [$148,800,000 $166,000,000. U.S.C. 133; Title 26 U.S.C.; 60 Stat. 810; Treasury Department Appropriation Act, 1965.) ments of tax returns; maintaining tax return files and furnishing information from the files as requested; and providing tax forms to taxpayers upon request. In those districts where revenue accounting has not yet been transferred to service centers, this activity performs all revenue accounting functions and makes determinations with respect to tax refunds, credits, penalties, abatements, or overassessments. 2. Service center automated operations.-This activity provides for overall direction of revenue accounting and processing functions, and for operation of Regional Service Centers, the National Computer Center, and the IRS Data Center. It is responsible for processing, verifying, and computing tax liabilities and maintaining master files of taxpayers and an account for each taxpayer. It performs revenue accounting, except where this function has not yet been transferred from the districts, and issues tax bills and notices of delinquencies and establishes delinquent accounts. It pays refunds or, where possible, offsets them against delinquent accounts. It compares information documents with tax returns and assists in the selection of returns for audit; and it provides investigation leads to potential failures to file tax returns. 3. Statistical reporting. This activity provides for the extraction and analysis of information from tax returns to be used in preparing and publishing annual reports and other studies, including the Statistics of Income series for use by the Treasury Department, the Joint Congressional Committee on Internal Revenue Taxation, the Council of Economic Advisers, the Internal Revenue Service, State governments, and others. 34,053 39,258 7,108 62,951 925 959 Object Classification (in thousands of dollars) Personnel compensation: Positions other than permanent. 33,332 39,481 Total number of permanent positions.. Full-time equivalent of other positions. Average number of all employees. Average GS grade............. Average GS salary.. 6,615 63,414 1965 estimate 101,865 66,140 1,466 206 Personnel Summary 1964 actual 1965 estimate 83,053 13,621 16,316 1,647 1,676 1966 estimate 103,799 67,505 216 34,539 41,104 6,861 64,484 1,100 1966 estimate 94,705 101,564 16,817 1,742 98,321 6,758 1,079 1,138 10,354 7,217 6,311 6,781 11.195 7,450 1,556 2,845 2,089 2,034 2,352 1,667 7,044 12,140 9,942 134,761 153,287 166,000 14,859 15,781 3,648 18,144 4,209 19,385 5.5 $5,859 5.6 $6,265 112,697 120,123 7,914 8,861 1,601 1,689 1,347 1,543 17,037 4,238 20,789 5.5 $6,213 Identification code 15-45-0913-0-1-904 10 COMPLIANCE For necessary expenses of the Internal Revenue Service for determining and establishing tax liabilities, and for investigation_and enforcement activities, including purchase (not to exceed [two hundred twenty-five] two hundred and forty-six for replacement only, [of which one hundred fifty] for police-type use which may exceed fiscal year) and hire of passenger motor vehicles; and services as by $300 each the general purchase price limitation for the current authorized by section 15 of the Act of August 2, 1946 (5 U.S.C. 55a), and of expert witnesses at such rates as may be determined by the Commissioner; [$418,350,000 $453,500,000. Title 26 U.S.C.; 60 Stat. 810; Treasury Department Appropriation (5 U.S.C. 133; Act, 1965.) Program and Financing (in thousands of dollars) 43 44 Program by activities: 1. Audit of tax returns.. 2. Collection of delinquent accounts and securing delinquent returns 3. Tax fraud and special investigations. 4. Alcohol and tobacco tax regulatory work. 5. Taxpayer conferences and appeals. 6. Rulings, technical planning, and special technical services.. 7. Legal services.......... 71 72 74 90 91 Total program costs, funded.. Change in selected resources 1. Total obligations... Relation of obligations to expenditures: 10 Total obligations... 70 Receipts and other offsets (items 11-17).-398,630 Expenditures excluding pay increase supplemental. Expenditures from civilian pay increase supplemental.... 1964 actual 1 Selected resources as of June 30 are as follows: Stores... Unpaid undelivered orders... Advances - Total selected resources___ 8,586 13,193 202, 191 217,040 229,690 93,528 100,093 104,077 29,276 31,844 35,178 33,224 35,483 35,487 18,454 21,396 23,876 1965 estimate 398,630 9,477 15,204 430,537 398,452 178 398,630 430,537 453,500 430,537 -293 -24 418,033 12,504 430,537 1966 estimate 418,350 453,500 430,537 9,540 15,652 453,500 1964 adjust1963 ments 1964 292 290 4,600 589 5,481 -319 -319 453,500 453,500 453,500 453,500 16,064 -16,064-38,639 402,357 430,537 12,116 388 1965 1966 290 290 4,478 4,478 4,478 572 572 572 5,340 5,340 5,340 INTERNAL REVENUE SERVICE-Continued General and special funds-Continued COMPLIANCE-Continued retrieve tax revenue lost because of noncompliance with the tax laws. 4. Alcohol and tobacco tax regulatory work.-This activity provides for administration and enforcement of internal revenue laws and regulations relating to alcohol and tobacco products. It is also responsible for administering and enforcing the Federal Alcohol Administration Act, the National Firearms Act, and the Federal Firearms Act. 1. Audit of tax returns. This activity provides for a selective examination of tax returns to see if taxpayers have properly complied with the internal revenue laws. It corrects errors and explains corrections to the taxpayers. It also makes determinations as to whether certain organizations or funds are exempt from taxation. 2. Collection of delinquent accounts and securing delinquent returns.—This activity provides assistance to taxpayers in understanding their tax obligations and is responsible for collecting taxes due but unpaid. 3. Tax fraud and special investigations.-This activity provides for enforcement of the criminal statutes relating 99.0 to violations of tax laws. It investigates cases of suspected intent to defraud; recommends prosecution as warranted; and assists in the preparation and trial of criminal tax It is responsible for directing Service participation in the organized crime drive. cases. 5. Taxpayer conferences and appeals.-This activity provides for administrative consideration and settlement of taxpayer appeals of audit findings. It conducts settlement negotiations in cases docketed in the Tax Court; hears protests over District Directors' findings in offers in compromise; and performs final technical review for the Commissioner of overpayments in excess of $100 thousand. 6. Rulings, technical planning, and special technical services. This activity develops tax return forms, instructions, and guides; issues rulings and opinions as to application of the tax laws, and meets with taxpayer groups to review and resolve special tax problems. 7. Legal services. This activity provides for the legal counsel and legal assistance needed by the Service to administer and enforce the internal revenue laws. represents the Service in cases before the Tax Court and District Courts. It advises the Department of Justice as to the defense of tax refund suits. It is responsible for legal review of proposed refunds or credits in excess of $100 thousand prior to referral of these cases to the Joint Congressional Committee on Internal Revenue Taxation. It also assists in negotiation of tax treaties and conventions with foreign countries. Identification code 11.1 11.3 11.5 Object Classification (in thousands of dollars) Personnel compensation: Total personnel compensation.. 23.0 Rent, communications, and utilities. 26.0 Supplies and materials.. 42.0 Insurance claims and indemnities.. Total obligations....... Total number of permanent positions. Full-time equivalent of other positions.. (Permanent, indefinite) Personnel Summary Identification code Program by activities: 10 Payment of interest on refunds (costs- 1964 1,387 2,349 331,231 361,509 376,916 380,652 912 6,604 6,555 8,367 2,774 3,041 3,103 4,741 4,555 3,731 3,541 3,728 453,500 Financing: 17 Recovery of prior year obligations (repay- 25 Unobligated balance lapsing.. 60 398,630 [ADMINISTRATIVE PROVISION] [Not to exceed 22 per centum of any appropriation available to the Internal Revenue Service for the current fiscal year may be transferred, with the approval of the Bureau of the Budget, to any other such appropriation or appropriations, but no such appropriation shall be increased by more than 22 per centum by such transfers, and any such transfers shall be reported promptly to the Appropriations Committees of the House and Senate.] (5 U.S.C. 133; Title 26 U.S.C.; 60 Stat. 810; Treasury Department Appropriation Act, 1965.) New obligational authority (appropria- REFUNDING INTERNAL REVENUE COLLECTIONS, Interest Relation of obligations to expenditures: 10 Total obligations.......... 71 70 Receipts and other offsets (items 11-17)..| 90 41,340 9.1 Program and Financing (in thousands of dollars) 430,537 88,502 41,257 356 41,440 9.2 $8,870 -93 1964 1965 1966 actual estimate estimate 88,502 88,502 -93 74,675 43,439 $8,888 -160 74,675 74,675 -160 88,409 74,515 88,409 74,515 81,675 -160 81,675 81,675 81,515 81,515 Under certain circumstances as provided in 26 U.S.C. 6611, interest is paid at 6% per annum on internal revenue collections which must be refunded. |