and the attorney or agent is superseded by another attorney or agent the new power of attorney should contain specific revocation of all others on file. However, the revocation by a principal or his legal representatives of authority to prosecute a matter will not be effective, so far as this bureau is concerned, without the assent of the head of the office before which the matter is pending. Where a matter has been suspended pending the furnishing of evidence for which a call has been made on an attorney or agent failure to take action thereon within three months from the date of suspension may be deemed by the administrative officer before whom the case is pending cause for revocation of the authority of the attorney or agent without further notice to him. (See also title "Checks in Payment of Refunds," section 7, post.)

VII. No reduction in taxes proposed, nor increases in allowance of claims, shall be made as the result of conferences unless the evidence upon which such action is taken is submitted in writing and over the sworn signature of the taxpayer. The affidavit of an attorney or agent will not be accepted unless it appears that such attorney or agent is the only person having actual knowledge of the facts presented. The sworn statement of facts must be submitted at least five days before the conference date, and must meet all of the issues raised by the bureau which the taxpayer desires to contest: Provided, however, that this requirement shall not preclude the taxpayer from submitting within a reasonable time after such conference any evidence or contention necessary to meet any theory or position taken by the bureau which could not reasonably have been anticipated prior to the conference.

VIII. Conferences with taxpayers or their representatives will not be held without previous arrangement. Cases in which taxpayers or their representatives can submit some unusual reason for requesting an immediate conference without previous arrangement as required above will be given consideration by heads of division in the bureau, who may, if the circumstances warrant, make an exception to the rule.

In order that the case under consideration may be closed at one conference, if at all possible, the requirements of paragraph VII, supra, to the effect that brief submitted in advance of conference must meet all issues raised, will be strictly enforced, and another conference will not be granted on the same case, except to meet new issues raised by the bureau in the course of the first conference, which could not have been anticipated prior to such conference.

The brief submitted shall cover, not only points in controversy as to income. and statutory invested capital, but, if it is the intention to make claim for consideration under the relief provisions, such claim must be embodied in the brief at the same time the contentions are raised on the points in controversy. It is absolutely necessary that facts pertaining to such claim for relief shall be set forth specifically in such brief, so that the bureau may consider the merits of such claim.

IX. Unenrolled employees of enrolled attorneys or agents will not be recognized in any matter by offices of the bureau except for the purpose of filing papers or securing information as to the status of cases. Recognition for the latter purpose will be given only when the employee presents in each case written authority from his employer to act as the latter's substitute in obtaining the information. desired regarding status and when the power of attorney of his employer in each

case provides for the substitution of such employee. To facilitate recognition of such employees, it is requested that the employee present at the time of making inquiry concerning any case receipts for the power of attorney issued to his employer by the taxpayer in that case and for the substitute power of attorney issued to him. These receipts will be furnished when the powers of attorney are filed.

X. Enrollment and power of attorney requirements must be met by attorneys or agents even though no actual appearance is made before the department, but where recognition is desired through correspondence with the department, provided that where a proper power of attorney is filed authorizing only one of the following acts by the agent, enrollment will not be required:

Authority to receive check in payment of refund. (See also title "Checks in Payment of Refunds," section 7, post.)

Authority to sign but not to prosecute any claim of the taxpayer. Authority to sign claim and receive check on behalf of taxpayer. (See also title "Checks in Payment of Refunds," section 7, post.)

Authority to inspect or receive copies of returns where executive order or regulations permit such action by agent.

If the power of attorney authorizes the agent to do one or more of the above acts and some other act or acts, enrollment will be considered necessary, notwithstanding that the agent or attorney does not expect to use all of the power conferred upon him.

XI. Letters arranging conferences will apprise the taxpayer or his representative of the requirements as to powers of attorney, statements of facts, and briefs, unless it is known that the requirements are known to the addressee. Owing to the expense involved, it will not be the practice, except in rare cases, to incorporate the above requirements in telegrams. Where sufficient time intervenes between the date of the telegram and the conference, the telegram will be confirmed by letter and conference requirements stated.

XII. These requirements apply with equal force to the field offices of the Bureau of Internal Revenue.

7. Supplemental Instructions for Execution of Powers of Attorney in Special Cases 77

In the special cases shown below certain requirements are set forth which must be met in addition to the general requirements contained in paragraph IV of section 6, supra, except as indicated.

Dissolved Partnership.-A power of attorney to act with respect to matters involving the affairs of a dissolved partnership must be signed by all of the former partners. In case some of the partners are dead, their legal representatives must sign in their stead. If, however, under the laws of the particular state, the surviving partners at the time of the execution of the power of attorney have exclusive right to the control and possession of the firm's assets for the purpose of winding up its affairs, their signatures alone will be sufficient. If only the surviving partners sign the power of attorney, a copy of the pertinent provisions of

77 Revision of July 1, 1925, superseding all previous orders as to conference and practice requirements in the Bureau of Internal Revenue, including the Income Tax Unit.

the state law under which they claim authority, exclusive of the legal representatives of the deceased partners, should be noted and citation given thereto.

Dissolved Corporation.-If a liquidating trustee, or trustee under dissolution, has been appointed, or if a trustee derives authority under a statute of the state in which the corporation was organized, the power of attorney should be executed by such trustee. If there is more than one trustee, all must join unless it is established that less than all have authority to act in the premises. The power of attorney must be accompanied by a copy of the instrument under which the trustee derives his authority, properly authenticated, or if the authority is derived under a state statute the statute should be cited and quoted, and an affidavit by a third party, setting forth the facts required by the statute as a precedent to the vesting of the authority in said trustee must be furnished. It must also appear in the case of any trustee tha his authority has not been terminated. If there is no trustee, then a power of attorney executed before a notary public by a sufficient number of individuals to make up a representation of a majority in the voting stock of the corporation at the date of dissolution will be accepted for purposes of conference and correspondence relating to the tax liability in the particular case. Such instrument must show the total number of outstanding shares of voting stock at the date of dissolution and the number held by each signatory to the power of attorney. The instrument must also contain positive averments as to the nonexistence of any trustee, and the date of dissolution must appear.

Insolvent Taxpayer.—A certificate from the court having jurisdiction over the insolvent should be furnished showing the appointment and qualification of the trustee or receiver, and it should appear that the authority has not terminated. In cases pending before a district court of the United States an authenticated copy of the order approving the bond of the trustee will meet this requirement. If an attorney has been appointed under authority of court for the trustee or receiver, a copy of the court order appointing such attorney (where he is to represent the trustee) should be furnished. If no attorney has been appointed, the trustee or receiver should execute the power of attorney, the acknowledgment or witnessing thereof to be the same as in the case of an individual, and the above-described evidence showing the appointment of the trustee or receiver furnished therewith. A 25-cent documentary stamp is not required on powers of attorney in bankruptcy If the trustee or receiver does not wish to appoint an attorney, he will be recognized upon establishing his authority in the manner above described.

cases.

Deceased Taxpayer.—Where a joint return was filed and accepted for a particular year the surviving spouse may execute the power of attorney, and it should be acknowledged or witnessed as in the case of an individual. It is desired, however, that the instrument be signed by the surviving spouse and the legal representative of the deceased where a joint return has been rendered. If the return was not joint, the executor or administrator should execute the power of attorney, which must be accompanied by a short-form court certificate (or authenticated copies of letters testamentary or letters of administration) showing that his authority is in full force and effect (or has not been revoked) at the time such evidence is submitted. The executor or administrator will be recognized in his own right if he does not wish to appoint an attorney upon submission of the above-described court certificate, and such executor or administrator is not required to be enrolled to practice. In the event the executor or administrator

has been discharged, a power of attorney may be accepted from the distributees of the estate of the deceased taxpayer provided it is accompanied by a statement from the court (1) (a) certifying to the fact of discharge of the legal representative and (b) naming the distributees and indicating the proper share to which each was entitled; or (2) an authenticated copy of the will, and in case there was no will affidavits and such other evidence as can be adduced tending to show the relationship to the deceased of the signatories to the power of attorney and the right of each of them to the respective shares claimed under the law of the domicile of the intestate. In case a refund of more than $500 is involved, administration should again be taken out on the estate, as the last-described evidence is not sufficient for the allowance of a claim in a greater sum.

Guardians and Other Fiduciaries Appointed by a Court of Record.-The power of attorney should be executed by the fiduciary and must be accompanied by a court certificate or court order showing that such fiduciary has been appointed and that his appointment has not been terminated.

Trustee Designated by a Deed or Declaration of Trust Not of Record in a Court. The authority of the trustee must be established as is required in the case of other fiduciaries. This may be accomplished by submitting an authenticated copy of the deed or declaration of trust or an extract thereof showing:

a. Date of document.

b. That it is not of record in any court.

c. The beneficiaries.

d. The trustee's appointment, authority and other pertinent information showing that the authority granted extends to matters relating to income-tax liability of the trustor.

Self-serving affidavits by trustees in this connection are not acceptable.

Trustee under a Document of Record in a Court, or Office of State or County Having Record of Such Documents.-Authority must be established by a certificate from the court or state or county office having custody of such records showing that the document under which the trustee derives his authority is of record and has not been revoked.

Checks in Payment of Refunds.-The bureau is not bound to deliver any check in payment of refund of internal revenue taxes, penalties, or interest to a representative of any taxpayer acting under authority evidenced by a power of attorney. However, it will be the policy of the bureau to mail such check in care of an attorney or agent who has filed a power of attorney specifically authorizing him to receive but not to indorse such check: Provided that such power of attorney shall have been filed in sufficient time for the section or division preparing the certificate of overassessment to show thereon the mailing address as "care of" the attorney or agent. Where attorneys or agents have more than one address request to mail checks to another address than is shown in the power of attorney will not be granted, due to the unwarranted effort involved in changing bureau records, unless the address shown in the power of attorney is no longer that of the attorney or agent. Further, it will be the policy of the bureau to mail such checks in care of the attorney or agent filing a power of attorney executed by the taxpayer authorizing him to receive same, and not to an associated attorney or agent of record who has been authorized to receive same by virtue of a power of attorney running from the attorney or agent designated by the taxpayer.

The Income Tax Unit is the agency of the Bureau of Internal Revenue for administering the income and profits tax laws. Its duties are:

(a) To prepare regulations for the administration of laws relating to taxes on income and profits;

(b) To conduct correspondence relating to the subject-matter of income and profits taxes;

(c) To receive from collectors of internal revenue all returns covering taxes on income and profits;

(d) To audit and verify returns and consider and dispose of all reports relating to returns or questions appertaining thereto;

(e) To assess all original and additional income and profits taxes;

(f) To assemble and audit certificates of ownership;

(g) To review and dispose of claims for abatement and refund of income and profits taxes;

(h) To compile statistics relating to income and profit taxes; and

(i) To control and operate all field forces verifying income and profits tax

returns.

2. History

An income tax was provided for in 1861,1 which was amended, continued, or superseded during the period from 1862 to 1870.2

The income tax law of 18943 was declared unconstitutional by the Supreme Court, as levying a direct tax not apportioned among the several states as required by the Constitution.5 The Secretary of the Treasury was directed to destroy all income tax returns and all statements and records relating thereto in the possession of the Treasury Department.®

The Sixteenth Amendment to the Constitution relieved all income taxes from the rule of apportionment."

The income tax law included in the Underwood Tariff Act of, 19138 was

1 Act Aug. 5, 1861, c. 45, §§ 49-51 (12 Stat. 309).

2 Act July 1, 1862, §§ 89-114 (12 Stat. 473); Act June 30, 1864, c. 73, §§ 116-150 (13 Stat. 281); Act March 3, 1865, c. 78, § 1 (13 Stat. 469); Act July 13, 1866, c. 184, § 9 (14) Stat. 137); Act March 2, 1867, c. 169, § 13 (14 Stat. 480); Act July 14, 1870, c. 255, §§ 6-17 (16 Stat. 257).

3 Act Aug. 27, 1894, c. 342, §§ 27-37 (28 Stat. 553). See, also, Res. Feb. 21, 1895 (28 Stat. 971).

4 Income Tax Cases, 157 U. S. 429, 15 S. Ct. 673, 39 L. Ed. 759; 158 U. S. 601, 15 S. Ct. 912, 39 L. Ed. 1108.

5 Const. U. S. article 1, § 2, cl. 3, and section 9, cl. 4.

6 Res. April 6, 1896, No. 42 (29 Stat. 470).

7 Brushaber v. Union Pac. R. Co., 240 U. S. 1, 36 S. Ct. 236, 60 L. Ed. 493, L. R. A. 1917D, 414, Ann. Cas. 1917B, 713.

8 Act Oct. 3, 1913, c. 16, § 2 (38 Stat. 166).