The Internal Revenue Service is a bureau of the Department of the Treasury under the immediate direction of the Commissioner of Internal Revenue.  The Commissioner has general superintendence of the assessment and collection of all taxes imposed by any law providing internal revenue. The Internal Revenue Service is the agency charged with the administration of the tax laws passed by Congress under which the assessment and collection of taxes are performed.


In 2004, the IRS collected more than $2 trillion in revenue and processed more than 224 million tax returns.  This collection represents a per capita liability of $6.67 for every man, woman and child in America, based on a total population of 300 million individuals.  Boasting of spending “just 44 cents for each $100 it collected in 2005”, the IRS cost the America taxpayer a mere $8,800,000,000.


Operations involving most taxpayers are carried out in district offices and service centers, also known by the more recently friendly name of “campus”. District offices are organized into Resources Management, Examination, Collection, Taxpayer Service, Employee Plans and Exempt Organizations, and Criminal Investigation. All tax returns are filed with various service centers around the country (Atlanta, GA; Andover, MA; Austin, TX; Charlotte, NC; Cincinnati, OH; Dallas, TX; Fresno, CA; Hartford, CT; Ogden, UT; Kansas City, MO, Philadelphia, PA; San Francisco, CA; and St. Louis, MO) where primary IRS computer operations are located.


The roots of IRS go back to the Civil War when President Lincoln and Congress, in 1862, created the position of commissioner of Internal Revenue and enacted an income tax to pay war expenses. The income tax was repealed 10 years later. Congress revived the income tax in 1894, but the Supreme Court ruled it unconstitutional the following year.

16th Amendment

In 1913, Wyoming ratified the 16th Amendment, providing the three-quarter majority of states necessary to amend the Constitution. The 16th Amendment gave Congress the authority to enact an income tax. That same year, the first Form 1040 appeared after Congress levied a one percent (1%) tax on net personal incomes above $3,000 and a six percent (6%) surtax on incomes of more than $500,000.

War Relief

In 1918, during World War I, the top rate of the income tax rose to 77 percent to help finance the war effort. It dropped sharply in the post-war years, down to 24 percent in 1929, and rose again during the Depression. During World War II, Congress introduced payroll withholding and quarterly tax payments.


In 1953, the bureau was reorganized to replace a patronage system with career, professional employees allowing only the IRS commissioner and chief counsel to be selected by the President and confirmed by the Senate.  The name, Bureau of Internal Revenue, was changed to the Internal Revenue Service to reflect a more service-oriented aspect of its work – a characteristic effort it continues to develop to this day.  By 1959, the IRS had become the world's largest accounting, collection, and forms-processing organization. Computers were introduced to automate and streamline its work and to improve service to taxpayers. In 1961, Congress passed a law requiring individual taxpayers to use their Social Security Number as a means of tax form identification. By 1967, all business and personal tax returns were handled by computer systems, and by the late 1960s, the IRS had developed a computerized method for selecting tax returns to be examined. This purportedly made the selection of returns for audit fairer to the taxpayer and allowed the IRS to focus its audit resources on those returns most likely to require an audit.


The IRS Restructuring and Reform Act of 1998 prompted the most comprehensive reorganization and modernization of IRS in nearly half a century. The IRS reorganized itself to closely resemble the private sector model of organizing around customers with similar needs.  Prior to 1987, all tax return processing was performed by hand. In an attempt to improve the speed and efficiency of the manual processing procedure, the IRS began testing an electronic return filing system beginning with the filing of 1985 returns.  The two most significant results of the test were that refunds for the electronically filed returns were issued more quickly and the tax processing error rate was significantly lower when compared to paper returns. Electronic filing of individual income tax returns are now operational throughout the country.

Tax Rules

While it may be in one’s interest to consult a tax attorney, certified public accountant, or other tax professional, the IRS provides invaluable information regarding rules, forms and enforcement procedures in the assessment and collection of taxes.  During and following a divorce, tax liabilities can often become quite confusing to both parents.  In addition to providing toll-free assistance from the Financial Management Service Help Desk at (800) 304-3107, online access will provide direct answers to frequently asked questions discussing such issues if a parent may be notified if the other parent filed a return and is entitled to a refund in the event of financial child support arrearages; who may claim the child(ren) to qualify filing as head of household; or whether child support or spousal payments are deductible or taxable income.  For more information and direct access to the Internal Revenue Service visit: