Rev. Proc. 80-59

Section 1. Purpose

The purpose of this revenue procedure is to establish the conditions under which a Presidential appointee who has an interest in a blind trust that meets the requirements of section 202(f)(4)(B) of the Ethics in Government Act of 1978, P.L. 95-521, 92 Stat. 1825 (1978), will be granted permission to have a trustee file the appointee's income tax return and to state the procedure that the trustee must follow in filing the appointee's income tax return.

Sec. 2. Changes

This revenue procedure modifies Rev. Proc. 79-43, 1979-2 C.B. 507, by setting forth the requirement that the letter granting permission for the trustee to make the appointee's return and a power of attorney both accompany the appointee's income tax return. It also sets forth the effect the Internal Revenue Service will give the power of attorney.

Sec. 3. Background

.01 Section 202(f)(4)(B) of the Ethics in Government Act of 1978 provides that in the case of a trust created for the benefit of an individual appointed by the President, by and with the consent of the Senate, an asset placed in trust will not be considered a financial interest of the individual for purposes of section 208 of title 18, United States Code, and any other conflict of interest statutes or regulations if certain requirements are met including giving the trustee the power to prepare on behalf of the individual the personal income tax return and similar returns which may contain information relating to the trust.

.02 Section 1.6012-1(a)(5) of the Income Tax Regulations, concerning returns made by agents, permits a return to be made by an agent if the taxpayer requests permission, in writing, of the appropriate district director and the district director determines that good cause exists for permitting an agent to make the return. That section provides that whenever a return is made by an agent it must be accompanied by a power of attorney (or copy thereof) authorizing the agent to represent the principal in making the return.

.03 Section 601.502(c)(1) of the Statement of Procedural Rules provides that a power of attorney which specifies the specific act to be performed is required if a taxpayer wishes to authorize his or her representative to perform any of the following acts: (1) Receive (but not endorse or collect) a check in payment of any refund of taxes, penalties or interest; (2) Execute a waiver of restriction on assessment or collection of a deficiency in tax, or a waiver of notice of disallowance of a claim for credit or refund; (3) Execute a consent to extend the statutory period for assessment or collection of a tax; or (4) Execute a closing agreement under section 7121 of the Code.

.04 Section 601.506(a) of the Statement of Procedural Rules provides that any notice or communication (or a copy thereof) required or permitted to be given to a taxpayer in any matter before the Service shall be given to the taxpayer's recognized representative. However, if such notice or communication contains confidential information with respect to the taxpayer, the notice or communication will be given to the representative only if there is on file with the Service a power of attorney or a tax information authorization in the matter signed by the taxpayer.

Sec. 4. Procedure

.01 A presidential appointee who has an interest in a blind trust that meets the requirements of section 202(f)(4)(B) of the Ethics in Government Act of 1978 and who requests permission, in writing, of the appropriate district director, for the taxpayer's federal income tax return to be filed by the trustee of the blind trust, will be considered to have shown good cause for receiving permission to have the return filed by the trustee, and will automatically be granted such permission. A separate request must be made for each taxable year.

.02 The trustee must submit with the return a copy of the letter from the Internal Revenue Service granting the trustee permission to sign the appointee's return. In addition, the return must be accompanied by a power of attorney (or copy thereof) that grants the trustee authority to sign the return, to receive (but not endorse or collect) a refund check, to execute a waiver of restriction on assessment or collection, to execute a waiver of notice of disallowance, to execute a consent to extend the period for assessment or collection, and to execute a closing agreement.

.03 All notices or other written communication required or permitted to be given to the appointee will be given to the trustee.

Sec. 5. Effective Date

This revenue procedure is effective as of December 29, 1980, the date of its publication in the Internal Revenue Bulletin.

Sec. 6. Effect on other Documents

Rev. Proc. 79-43 is modified and superseded.