DOJ Tax to Retain Similar Oversight After Planned Reorganization

The Justice Department’s tax enforcement functions will have similar supervision from tax-focused managers despite the division’s planned split, a top department official said.

The DOJ tax division is transferring its enforcement work to respective criminal and civil divisions as part of a broader reorganization plan. That reorganization is set to be finalized by August and sparked concern among former DOJ tax officials, who said it’s a signal to taxpayers that enforcement will slacken.

“Reports of our death are greatly exaggerated,” Karen Kelly, acting deputy assistant attorney general at the DOJ tax division, said Friday during a panel at the New York University Annual Tax Controversy Forum. “Tax enforcement is going to continue.”

Tax has specific levels of review and managerial approvals needed for cases that are different from other civil and criminal cases. Those reviews will stay in place, though the positions themselves will change, Kelly said. There will be a tax section within both the criminal and civil divisions.

• The tax division isn’t laying off any attorneys or administrative staff as part of the reorganization, Kelly said, though attorneys have left through the administration’s deferred resignation offer.
• The plan isn’t yet final, Kelly said, and DOJ is working on changing regulations needed to accommodate the reorganization.