Ezel / IRS Rulings / 200848053

CCA 200848053: Case-closure evaluations violate quantity-measure rule, not ROTER ban

Number
200848053
Outcome
Advice
Document type
Chief Counsel Advice
IRS subject
Issues in Case Not Yet Identified
Topics
Other topics
Code sections
§ RRA 1998 § 1204
Ruling dated
July 23, 2008
Publicly released
November 28, 2008
Source
View Official PDF

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This page covers legal advice the IRS Office of Chief Counsel wrote for IRS staff, issued in 2008, which can't be cited as precedent. Ask about your situation and see what the current Code and IRS guidance say, with citations.

Currency note: this determination was released in 2008
Statutory amendments, regulation changes, court decisions, or later IRS guidance may have changed the analysis since then. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, threshold, or position mentioned here.
Not precedent. Under 26 U.S.C. § 6110(k)(3), this written determination may not be used or cited as precedent. It is advice from the IRS Office of Chief Counsel to IRS personnel on the facts they presented, and identifying details were redacted by the IRS before release. The official IRS release (linked on this page as a PDF) is the authoritative source.
About this page: The plain-English summary and ruling snapshot below were written by Ezel based on the official IRS release. The full text is the IRS's own document.
View official IRS release (PDF)

Plain-English summary

Two documents evaluated Automated Underreporter Program employees partly by their case-closure rate. Chief Counsel advised that cases closed and time per case were not records of tax enforcement results, so using them did not violate the RRA 1998 section 1204 ban on using those results or imposing production quotas. The same evaluations nevertheless appeared to violate a separate regulation. That rule prohibited rating these employees with outcome-neutral quantity measures such as cases closed, work items completed, time per case, and inventory data.

Ruling snapshot

  • Question: Do employee evaluations based on case closures violate the ROTER restriction or other performance-measure rules?
  • Outcome: Advice given. They do not violate section 1204's ROTER ban, but appear to violate the regulation barring outcome-neutral quantity measures.
  • Key authorities: RRA 1998 § 1204; 26 C.F.R. §§ 801.3T(e)(3) and 801.6T.

Full text (IRS public release)

1

ID: CCA-723115-08 Number: 200848053
Office: ------------------
Release Date: 11/28/2008

UILC: 0099.04-14

From: -----------------------
Sent: [Wedneday, July 23, 2008 11:15 AM]
To: ---------------------
Cc: ------------------------
Subject: 1204/801 Information

I have reviewed the two documents you provided which evaluate employees working in the Automated Underreporter Program based in part on their case closure rate. As we discussed yesterday, I do not believe this constitutes a violation of RRA '98 Section 1204. Section 1204 prohibits the Service from using records of tax enforcement results (ROTERs) to evaluate employees or to impose or suggest production quotas or goals on employees. Cases closed and time per case are not ROTERs. See, e.g., 26 C.F.R. section 801.6T(d). Therefore their use in evaluating employees, or suggesting production quotas, does not run afoul of Section 1204. However, the two examples you provided would seem to constitute a violation of 26 CFR section 801.3T(e)(3), which prohibits evaluating the performance of these employees based on outcome-neutral quantity measures such as cases closed, work items completed, time per case, and inventory information. See 26 CFR section 801.6T(c).

If you have any questions about this, or if I may be of further assistance, please feel free to contact me.

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