Penalty dispute requires supervisory approval

Plain-English summary

Chief Counsel advised that supervisory approval is required when a taxpayer responds by disputing either a penalty or the underlying adjustments that affect it. Other taxpayer contacts require a case-by-case analysis. The question is whether approval was required or whether the exception for penalties automatically calculated through electronic means continues to apply.

Ruling snapshot

• Question: Does a taxpayer's response remove a penalty from the exception for amounts automatically calculated through electronic means?
• Outcome: Advice given, a dispute requires approval and other contacts depend on the facts
• Key authorities: IRC § 6751

Full text (IRS public release)

 ID:        CCA_2023072510312046             Third Party Communication: None

 UILC:      6751.02-00                       Date of Communication: Not Applicable

Number: 202346022
Release Date: 11/17/2023
From: ----------------------
Sent: Tuesday, July 25, 2023 10:31:20 AM
To: ----------------------
Cc:
Bcc:
Subject: RE: Supervisory Approval Question


Hi ------------,

If a taxpayer sends a response that disputes the penalty or underlying adjustments
affecting the penalty, supervisory approval would be required. Other instances of
taxpayer contact are evaluated on a case by case basis to determine if supervisory
approval was required or if the automatically calculated through electronic means
exception applies.

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