Have you ever heard anybody complaining about the IRS and their IRS code? They might be angry. They might even be justified, but they don’t understand where their pain is really coming from. Our income tax represents a frequent and direct contact with our federal government, so why not understand something about the source of this interaction?
It begins with our constitution and the 16th amendment; The Congress shall have power to lay and collect taxes on income, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.
From the Constitution comes the tax law. The U.S. Code is the collection of our laws and it is divided into 53 chapters called titles. The Internal Revenue Code (IRC), title 26, is one of the four largest. The IRC, being a collection of laws, can only come from our legislators in Congress. The IRS is administrative in nature and does not have the authority to write any laws or regulations. If you have a beef about your tax laws you will need to take it to the Congress via your legislators.
The IRC is further divided up into specific code sections. To make the code sections easier to use, the Treasury has authority to promulgate tax regulations, or what you might perceive as, “The rules.” Think of it like this; if the code allows a business to make an election to be taxed using a specific method, the regulations bring forth the forms and procedures that make the election take place.
The IRS works for the Treasury Department. It issues Proposed Treasury Regulations which are published for comments and revisions prior to the final regulations being passed. The IRS is an administrative agency with interpretive authority. The IRS will clarify particular factual situations by issuing Revenue Rulings, Revenue Procedures, Notices, and Announcements. The IRS helps taxpayers comply with the tax laws, and they enforce the laws, but they do not make the laws.