- According to the U.S. Treasury regulations, "...the Internal Revenue Service is a bureau of the Department of the Treasury under the immediate direction of the Commissioner of Internal Revenue. The Commissioner has general superintendence of the assessment and collection of all taxes imposed by any law providing internal revenue. The Internal Revenue Service is the agency by which these functions are performed." (26 C.F.R. section 601.101(a).)
- In essence, the IRS is a branch of the United States Department of the Treasury which is responsible for collecting all federally levied taxes. As an agency, it is charged with creating tax forms, distributing them, enforcing the tax code, auditing tax returns, issuing tax refunds when applicable, and generally handling all other aspects necessary to collect federal taxes.
- The IRS is massive in scale. It collects all of the tax returns from the nation each year and reviews them for errors, miscalculation and fraud. If a taxpayer's tax return was incorrect, late or fraudulent, the IRS may levy fines or other penalties. If IRS agents suspect a taxpayer of misconduct, then they will begin a general audit of that taxpayer. During an audit, the taxpayer is required to show conclusive proof of the numbers on their tax return. The IRS, after collecting all monies due to it, turns that money over to the Treasury, where it is kept for later usage.
