of all mining in the United States, the General Land Office, the Office of Indian Affairs, the Pension Office, the Patent Office, the District of Columbia PENITENTIARY, the U.S. census, and accounts for federal court officers. These agencies and duties had little in common except that their focus was within U.S. borders, and they were out of place in other departments. As a result of the continuing search for streamlined organiz ation in government, the Department of the Interior eventually dropped a number of its original duties and developed an emphasis on natural resources. The department has retained responsibility for mining, federal lands, and American Indian issues. Over the years, it has added several offices and bureaus to help fulfill its responsibilities. The chief functions of the Department of the Interior include efforts to conserve and develop mineral and water resources; to con- serve, develop, and utilize fish and wildlife resources; to coordinate federal and state recre- ation programs; to preserve and administer scenic and historic areas; to operate the Job Corps Conservation Centers and Youth and Young Adult Conservation Corps Camps, and other youth training programs; to irrigate arid lands; to manage hydroelectric systems; to provide social and economic services to U.S. territories; and to provide programs and services to Native Americans. The Department of the Interior contains several different offices, departments, and bur- eaus. The Office of the Secretary includes the Offices of the Deputy Secretary, Assistant Secretaries, and Inspector General. The inspector general is charged with coordinating and super- vising interior audits and with performing inspections to detect fraud and ABUSE. In addition, the inspector general is responsible for supervis- ing the financial activities of U.S. territories such as Guam, American Samoa, and the Virgin Islands. The Office of Hearings and Appeals is also contained within the Office of the Secretary. Persons involved in disputes with the Depart- ment of the Interior may have their cases heard at this office. The hands-on work of the department is performed by several bureaus and services. The Bureau of Reclamation is devoted to the management of water resources. The Bureau of Land Management is in charge of public lands and resources. The U.S. Geological Survey exists to draw a wide variety of maps and to examine and classify public land structures and mineral resources. The Minerals Management Service assesses the value of minerals and supervises mineral recovery. The Office of Surface Mining Reclamation and Enforcement is charged mainly with the operation of a nationwide program on coal mining. The U.S. Bureau of Mines researches mining issues in order to find the best technology for extracting, processing, using, and recycling non-fuel min- eral resources. The National Biological Survey conducts research to promote the sound management of plant and animal life. The National Park Service is dedicated to the preservation of national parks, monuments, scenic parkways, preserves, trails, riverways, seashores, lakeshores, and recreation areas. The U.S. Fish and Wildlife Service is devoted primarily to the conservation and enhancement of the nation’s fish and wildlife resources. One controversial function of the depart- ment is the oversight of Indian affairs. The Bureau of Indian Affairs (BIA) performs a number of functions that have to do with Native American issues. The Department of the Interior played a dominant role in the drafting of tribal constitutions during the nineteenth century. During the twentieth century, the Bureau of Indian Affairs continued its control over Indian tribes by insisting on review and approval powers over amendments to tribal constitutions. The BIA’s management of an Indian land trust led to a high-prof ile lawsuit in 1996 over A member of the U.S. Fish and Wildlife Service, a division of the Interior Department, prepares to release a salmon into the Connecticut River. The service is concerned with the conservation of species threatened by loss of habitat. AP IMAGES GALE ENCYCLOPEDIA OF AMERICAN LAW, 3 RD E DITION 468 INTERIOR DEPARTMENT the failure of the BIA to provide Indians with accurate financial accountings of lands held in trust for them by the Department of the Interior. U.S. district court Judge Royce Lam- berth has overseen the CLASS ACTION, and by the September 2002 he had had lost patience with the department and Secretary Ga le Norton over the lack of effort and honesty in dealing with the issues before the court. In a scathing 267-pag e RULING, Lamberth concluded that the depart- ment and Norton were “either unwilling or unable to administer competently the [Indian} trust.” The plaintiffs allege that the BIA cannot account for $137 billions of income due the 500 members of the class, and the district court held the secretary of the interior in contempt, Cobell v. Norton, 226 F.Supp.2d 163 (D.D.C.2002). The DC CIRCUIT COURT of Appeals later held that: (1) the secretary was not in criminal contempt of order requiring her to initiate historical accounting project; (2) the secretary did not commit fraud on court, so as to be in criminal contempt, with respect to quarterly status reports; and (3) the secretary did not commit fraud on court, so as to be in criminal con- tempt, with respect to her representations regarding computer security of trust data (334 F.3d 1128 [D.C.Cir., Jul 18, 2003]). Like most other federal administrative agen- cies, the Department of the Interior is controlled by both Congress and the president. Congress created the Department of the Interior, and it could decide to reduce or eliminate it. However, also like most other administrative agencies, the Department of the Interior is a political necessity. Lawmakers are generally well versed in a broad range of topics, but few have the knowledge required to craft the best rules and regulations on, for example, mining or land management. The Department of the Interior possesses such expertise. At the executive level, the Department of the Interior reports directly to the president, who also exerts control over it. The president has the power to rem ove and replace department personnel, to propose in creases or reductions in responsibilities, and to redirect the depart- ment’s goals. All of these changes must be approved by Congress. This dual control over the Department of the Interior makes it subject to political influence. For example , when a new president takes office, he or she will likely make personnel changes in the Department of the Interior to initiate new programs and directions promised in the campaign. Any high-level appointments to administrative agencies will be reviewed by Congress. If a nominee holds views that are contrary to those of the majority in Congress, Congress may reject the nominee, and the president may have to choose one more acceptable to Congress. However , senators and representatives may be reluctant to resist the actions of a newly elected president for fear of alienating the voting public. Historically, the Department of the Interior has been less concerned with conservation than with development. Interior Secretary Roy O. West commented in 1928 that the Department of the Interior should have been named the Department of Western Development. In the early twentieth century, U.S. citizens became aware that the resources that were needed for modern life were not inexhaustible, and the Department of the Interior gradually recognized the need for conservation. However, the Department of the Interior’s original mission of managing development was at odds with conservation, and the department was incapable of concentrating exclusively on conservation. To fill the void created by this situation, Congress created the ENVIRONMENTAL PROTECTION AGENCY (EPA) in 1970. Although the EPA has taken over the goals of conservation and pollution control, the Department of the Interior is still concerned with environmental matters. In 1987, the department reorganized the Bureau of Recla- mation to reflect the bureau’s new emphasis on management and conservation instead of con- struction. In the 1990s, Bruce Babbitt, the secretary of the interior under President BILL CLINTON , made several changes in the Depart- ment of the Interior to strengthen its environ- mental-protection efforts. Web site: www.doi.gov. FURTHER READINGS Friedman, Howard M. 1992. “The Oversupply of Regulatory Reform: From Law to Politics in Administrative Rulemaking.” Nebraska Law Review 71. Hines, N. William. 1994. “The Land Ethic and American Agriculture.” Loyola of Los Angeles Law Review 27. Interior Department Web site. Available online at http:// www.doi.gov (accessed August 1, 2009). Pommersheim, Frank, and Shermann Marshall. 1992. “Liber- ation, Dreams, and Hard Work: An Essay on Tribal Court Jurisprudence.” Wisconsin Law Review 411. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION INTERIOR DEPARTMENT 469 U.S. Government Manual Website. Available online at http:// www.gpoaccess.gov/gmanual/ (accessed July 21, 2009). Volkman, John M. 1987. “Testing New Forms of River Basin Governance: Implication of the Seattle Master Builders Case.” Environmental Law 17. CROSS REFERENCES Environmental Law; Fish and Fishing; Game; Mine and Mineral Law; Native American Rights. INTERLINEATION The process of writing between the lines of an instrument; that which is written between the lines of a document. An interlineation frequently appears in a contract that has been typed and signed. If the parties agree that a sentence is to be inserted between the lines to clarify a part icular provi- sion, the new sentence is known as an interlineation. The new line should be initialed and dated to indicate that both parties are aware of and agree to its insertion. An interlineation results in the alteration of an instrument. CROSS REFERENCE Alteration of Instruments. INTERLOCKING DIRECTORATE The relationship that exists between the board of directors of one corporation with that of another due to the fact that a number of members sit on both boards and, therefore, there is a substan tial likelihood that neither corporation acts indepen- dently of the other. Because the same persons occupy seats on the boards of companies that are supposed to compete in the marketplace, there is a potential for violations of federal antitrust acts, particu- larly the CLAYTON ACT (15 U.S.C.A. §§ 12-27 [1914]) w hich prohibits the existence of inter- locking direc torates that substantially reduce commercial competition. INTERLOCUTORY Provisional; interim; temporary; not final; that which intervenes between the beginning and the end of a lawsuit or proceeding to either decide a particular point or matter that is not the final issue of the entire controversy or prevent irrepara- ble harm during the pendency of the lawsuit. Interlocutory actions are taken by courts when a QUESTION OF LAW must be answered by an appellate court before a trial may proceed or to prevent irreparable harm from occurring to a person or property during the pendency of a lawsuit or proceeding. Generally, courts are reluctant to make interlocutory orders unless the circumstances surrounding the case are serious and require timely action. Interlocutory appeals are restricted by state and federal appellate courts because courts do not want piecemeal litigation. Appeals courts generally review only cases that have reached final judgment in the trial courts . When a COURT ADMINISTRATOR enters final judgment, this certi- fies that the trial court has ended its review of the case and jurisdiction shifts to the appellate court. Interlocutory appeals are typically permitted when the trial judge certifies to the appellate court in an interlocutory order that an impor- tant question of law is in doubt and that it will substantially affect the final result of the case. Judicial economy then dictates that the court resolve the issue rather than subject the parties to a trial that may be reversed on an appeal from a final judgment. Appellate courts have the discretion to review interlocutory orders. The federal courts of appeal are governed by the Interlocutory Appeals Act (28 U.S.C.A . § 1292). This act grants discretion to the courts of appeal to review interlocutory orders in civil cases where the district judge states in the order that a controlling question of law is in doubt and that the immediate resolution of the issue will materially advance the ultimate termination of litigation. State appellate courts are governed by statutes and court rules of appellate procedure regarding the review of interlocutory orders. When an appellate court reviews an inter- locutory order, its decision on the matters contained in the order is final. The court enters an interlocutory judgment, which makes that part of the case final. Therefore, if a case proceeds to trial after an interlocutory judgment is entered, and an appeal from the trial court judgment follows, the matters decided by the interlocutory judgment cannot be reviewed by the court again. Interlocutory order s may be issued in a DIVORCE proceeding to prevent injury or irrepa- rable harm during the pendency of the lawsuit. For example, an interlocutory order may require one spouse to pay the other spouse a designated w eekly sum for support, pending a GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 470 INTERLINEATION decision on ALIMONY and CHILD SUPPORT. This prevents the spouse and children from being without income during the action. Courts may also issue interlocutory orders where property is about to be sold or forfeited and a lawsuit has been filed seeking to stop the action. In this type of case, a court will enter an interlocutory injunction, preventing the transfer of property until it has made a final decision. To do otherwise would cause irreparable harm and would complicate LEGAL TITLE to the property if the person contesting the transfer ultimately prevailed. Thus, though the courts value finality in most proceedings, interlocutory orders and appeals are available to protect import ant rights and to enhance judicial economy. INTERMEDIATE-RANGE NUCLEAR FORCES TREATY The INTERMEDIATE-RANGE NUCLEAR FORCES TREATY of 1987 (INF) was the first NUCLEAR WEAPONS agree- ment requiring the United States and the Union of Soviet Socialist Republics (U.S.S.R.) to reduce, rather than merely limit, their arsenals of nuclear weapons. Signed by President RONALD REAGAN,of the United States, and General Secretary Mikhail Gorbachev, of the U.S.S.R., on December 8, 1987, the INF Treaty eliminated all land-based nuclear missiles with ranges of between 300 and 3,400 miles. The U.S. Senate quickly ratified the treaty in 1988 by a vote of 93–5. The INF Treaty marked an historic shift in superpower relations and was the first super- power arms control treaty since 1979. It required the removal of 1,752 Soviet and 859 U.S. short- and intermediate-range missiles, most of which were located in Europe. It was the second superpower agreement to ban an entire class of weapons, the first being the 1972 Biological Weapons Convention. The INF Treaty also contained unprecedented verification proce- dures, including mandatory exchanges of relevant missile data, on-site inspections, and satellite surveillance. Soviet concessions in the INF negotiations grew out of Gorbachev’s efforts to limit military competition between the United States and the U.S.S.R. The new Soviet willingness to make arms-control concessions was first evident in the 1986 Stockholm Accord, which established various confidence- and security-building mea- sures between the superpowers and their allied countries, including on-site inspections and advance warning of military movements. In 1988, a year after signing the INF, Gorbachev continued his ambitious program of military cuts by announcing a unilateral reduction of 500,000 troops, including the removal of 50,000 troops and 5,000 tanks from eastern Europe. These developments met with a positive response from the United States and its NORTH ATLANTIC TREATY ORGANIZATION allies, and created an atmosphere that would be conducive to future arms accords, including the CONVENTIONAL FORCES IN EUROPE TREATY of 1990 and the Strategic Arms Reduction Treaties of 1991 and 1993. Several successor states to the Soviet Union, including Belarus, Kazakhstan, and Ukraine, continue to implement the treaty. Other Euro- pean nations, including Germany, Hungary, Poland, Czech Republic, and Slovakia, voluntar- ily destroyed their medium-range missiles in the 1990s. The United States also persuaded Bul- garia to destroy its missiles in 2002. The right of parties to the treaty to conduct on-site inspec- tions expired on May 31, 2001. However, parties still may conduct satellite surveillance to ensure that member states comply with the treaty. The treaty established the Special Verification Com- mission to implement the treaty, and the commission continues to meet regularly. FURTHER READINGS Falkenrath, Richard A. 1995. Shaping Europe’s Military Order: The Origins and Consequences of the CFE Treaty. Cambridge, MA: Massachusetts Institute of Technology Press. U.S. President Ronald Reagan and Soviet President Mikhail Gorbachev sign the INF Treaty on December 8, 1987. The treaty called for an elimination of an entire class of short- and intermediate- range nuclear missiles. AP IMAGES GALE ENCYCLOPEDIA OF AMERICAN LAW, 3 RD E DITION INTERMEDIATE-RANGE NUCLEAR FORCES TREATY 471 Sheehan, Michael. 1988. Arms Control: Theory and Practice. Cambridge, MA: Blackwell. Wirth, Timothy E. 1988. Intermediate-Range Nuclear Forces Treaty and the Conventional Balance in Europe. Washington, D.C.: U.S. Government Printing Office. CROSS REFERENCES Arms Control and Disarmament; Cold Wa r; Conventional Forces in Europe Treaty. INTERNAL AUDIT An inspection and verification of the financial records of a company or firm by a member of its own staff to determine the accuracy and accept- ability of its accounting practices. INTERNAL REVENUE CODE The Internal Revenue Code is the body of law that codifies all federal tax laws, including income, estate, gift, excise, alcohol, tobacco, and employ- ment taxes. These laws constitute title 26 of the U.S. Code (26 U.S.C.A. § 1 et seq. [1986])andare implemented by the INTERNAL REVENUE SERVICE through its Treasury Regulations and Revenue Rulings. Congress made major statutory changes to title 26 in 1939, 1954, and 1986. Because of the extensive revisions made in the TAX REFORM ACT OF 1986, title 26 is now known as the Internal Revenue Code of 1986 (Pub. L. No. 99-514, § 2, 100 Stat. 2095 [Oct. 22, 1986]). Subtitle A of the Code contains five chapters on income taxes. The chapters cover normal income taxes and surtaxes, taxes on self- employment income, withholding of taxes on nonresident aliens and foreign corporations, taxes on transfers to avoid income tax, and consolidated returns. Subtitle B deals with ESTATE AND GIFT TAXES. The rules and regulations concerning the TAXATION of probate estates and gifts are very complicated. This subtitle contains chapters on taxing generation-skipping transfers and rules on special valuation of property. Subtitle C contains the law of employment taxes. It consists of chapters on general provi- sions relating to employment taxes and ot her sections dealing with federal insurance contri- butions, railroad retirement taxes, and federal unemployment taxes. Subtitle D covers miscellaneous excise taxes. Its fifteen chapters cover a variety of issues, including retail excise taxes, manufacturers’ excise taxes, taxes on wagering, environmental taxes, public charities, private foundations, pension plans, and certain group health plans. Subtitle E covers alcohol, tobacco, and other excise taxes. Chapter 53 deals with machine guns, destructive devices, and certain other firearms. Subtitle F contains provisions on procedure and administration. Under this subtitle are twenty chapters that deal with every step of the taxation process, from the setting of filing dates and the collection of penalties for late filing, to criminal offenses and judicial proceed- ings. The rules for administrative proceedings under the Code are addressed in the appendix to title 26. Subtitle G addresses the organization of the Congressional Joint Committee on Taxation. Subtitle H contains the rules for the financing of presidential election campaigns. Subtitle I con- tains the Trust Fund Code. The Internal Revenue Code has grown steadily since the 1930s. The complexity of its provisions, most of which are written in technical language, has required law and accounting firms to develop specialists in the various areas of taxation. CROSS REFERENCE Election Campaign Financing. INTERNAL REVENUE SERVICE The Internal Revenue Service (IRS) is the federal agency responsible for administering and enfor- cing all internal revenue laws in the United States, except those relating to alcohol, tobacco, firearms, and explosives, which are the respon- sibility of the Alcohol, Tobacco, Firearms, and Explosives Bureau’s Tax and Trade division. The IRS is the largest agency in the TREASURY DEPARTMENT . By the mid-1990s it had approxi- mately 110,000 employees, 650 office locations in the United States, and 12 offices abroad. The agency processes approximately 205 million tax returns and collects more than $1.2 trillion each year. The U.S. tax system, which the IRS oversees and administers, is based on the principle of voluntary compliance. According to the IRS, this means “that taxpayers are expected to comply with the law without being compelled to do so by actio n of a federal agent; it does not GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 472 INTERNAL AUDIT mean that the taxpayer is free to decide whether or not to comply with the law.” Duties and Powers The IRS is responsible for enforcing the INTERNAL REVENUE CODE (U.S.C.A. tit. 26), which codifies all U.S. tax laws. Basic IRS activities include serving and educating taxpayers; deter- mining, assessing, and collecting taxes; investi- gating individuals and organizations that violate tax laws; determining pension plan qualifica- tions and exempt organization status; and issuing rulings and regulations to supplement the Internal Revenue Code. Historically, Congress has given the IRS unique and wide-ranging powers for adminis- tering the U.S. tax system and enforcing its laws. For example, while in a criminal proceeding the government has the burden to prove that the DEFENDANT is guilty BEYOND A REASONABLE DOUBT, in a tax proceeding the burden is on the taxpayer to prove that he or she does not owe the amount claimed by the IRS. The IRS also has the power to impose civil penalties for any of a number of violations of tax law. These penalties are seldom employed, however, and with respect to penalties, the IRS bears the burden of proving that the penalty is justified. The IRS has the power to collect large amounts of information on U.S. citizens , companies, and other institutions. The most obvious example of this power is that each year all taxpayers must file tax returns containing detailed financial and personal information. Many organizations are also required to notify the IRS of any payments they make to individuals; the IRS receives approximately one billion of these third-party reports annually. The IRS also has the legal authority to order banks, employers, and other institutions to provide information about a taxpayer without having to obtain a warrant from a judge; other law enforcement agencies, such as the FEDERAL BUREAU OF INVESTIGATION and local police forces, must obtain a warrant in such situations. Another crucial power of the IRS is the ability to withhold taxes automatically from employee paychecks. The IRS was given this authority in 1943, when Congress passed legislation requiring employers to withhold from employees’ paychecks the income taxes owed to the government. This withholding requirement was one of several actions taken by the government to increase revenue so that it could meet the huge financial requirements for fighting WORLD WAR II. In the early 2000s automatic withholding accounts for the majority of tax dollars paid to the government, with only a small portion sent in with tax returns by April 15, the IRS annual tax deadline. Automatic withholding is important to the government because it enables it to receive a steady stream of tax revenue. It is also useful for enforcing voluntary compliance from taxpayers because the individual’s tax burden seems less onerous when taxes owed are subtracted from a paycheck before the check is received. Organization The IRS is led by a commissioner, who works in the IRS National Office located in Washington, D.C. The commissioner and his or her chief counsel are appointed by the president and must be approved by the Senate. The chief counsel serves as the chief legal adviser to the IRS. At the next level are regiona l commis- sioners, who oversee IRS operations in the four regions into which the country is divided: the Corporation income taxes 12.9% Employment taxes a 32.2% Individual income taxes 52.0% Internal Revenue Gross Collection, by Source, in 2008 a Includes OASDHI, railroad retirement, and unemployment insurance. Excise taxes b 1.9% Estate and gift taxes 1.1% Total collections: 2.74 trillion dollars SOURCE: Internal Revenue Service, Internal Revenue Gross Collections, By Type of Tax, Fiscal Years 2007 and 2008. b Excludes taxes on alcohol, tobacco, and firearms, now collected by the Bureau of Alcohol, Tobacco, and Firearms and by the Customs Service. ILLUSTRATION BY GGS CREATIVE RESOURCES. REPRODUCED BY PERMISSION OF GALE, A PART OF CENGAGE LEARNING. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3 RD E DITION INTERNAL REVENUE SERVICE 473 Northeast, Southeast, Midstates, and Western Regions. Within the four regions are 33 district offices, which are responsible for collecting revenue, examining returns, and pursuing crimi- nal investigations within their geographic area. Also located across the country are ten service centers, five submission processing centers, two computing centers, and 23 customer service centers. In addition to its geographic divisions, the IRS is organized into programs focusin g on specific administrative tasks. Several of these, including the Taxpayer Services and Problem Resolution programs, focus on taxpayer assis- tance and education. Others, including the Examination, Collection, and Criminal Investi- gation divisions, focus on ensuring taxpayer compliance. Additional IRS programs include Appeals, which attempt s to resolve tax contro- versies without litigation; Statistics of Income, which compiles and publishes data relating to the operation of the Internal Revenue Code; and Tax Practitioner Conduct, which enforces tax laws applying to attorneys, accountants, and taxpayer agents. History The IRS was created in 1952, though it was preceded by various other U.S. tax-collecting offices. The earliest incarnation of the IRS was the Office of the Commissioner of Revenue, which was established by Congress in 1792 in response to the request by Secretary of the Treasury ALEXANDER HAMILTON that various tariffs and taxes be created to raise money to pay off the U.S. Revolutionary War debt. Trench Coxe of Pennsylvania was the first person to hold the office. By creating the Office of the Commis- sioner of Revenue, Congress delegated its constitutional power to “lay and collect taxes, duties, imposts, and excises” to the Treasury Department, which has retained the power ever since (art. 1, § 8, U.S. Constitution). By the time THOMAS JEFFERSON became presi- dent in 1801, the internal revenue program had grown to employ 400 revenue officials, who enforced a wide variety of tax regulations, including taxes on distilled spirits, land, houses, and slaves. Jefferson, a Democrat who fiercely opposed Hamilton and his FEDERALIST PARTY programs, abolished the entire system and relied instead on taxes assessed on imported items for government revenue. When the WAR OF 1812 increased the government’sneedsforfunds,taxes were reimposed on items such as sugar, carriages, liquor, furniture, and other luxury items. At the war’s end, all internal taxes and collection offices were abolished, and CUSTOMS DUTIES again became the primary source for government revenue. When the Civil War broke out in 1861, President ABRAHAM LINCOLN faced a financial crisis because the government needed much more money to finance the war effort than could be raised through customs duties. To address this problem, Congress passed sweeping new tax measures, including the Civil War Revenue Act of August 5, 1861, which autho- rized the country’s first income tax and imposed a DIRECT TAX of $20 million apportioned among the states. The Revenue Act of July 1, 1862, created a wide variety of new taxes. To oversee their collection, Congress create d the Bureau of Internal Revenue under the secretary of the treasury. This office, which represents the first form of the modern internal revenue collection system, administered the tax system by dividing the country into 185 collection districts. The commissioner was given the power to enforce tax laws through both seizure and prosecution. George S. Boutwell of Massachusetts was the first commissioner of internal revenue. Boutwell was initially assisted by three clerks. By January 1863 the office had grown to employ nearly 4,000 people, most of whom worked in the field as revenue collectors or property assessors. When the Civil War ended in 1865, the government’s need for revenue was greatly reduced. Taxes were scaled back, the income tax was eliminated, and customs duties again became a sufficient source for federal funds. With the subsequent rise of industrialism and growth of populist political ideas, however, many citizens wanted the government to take a more active role and therefore lobbied for a reestablishment of the income tax to provide greater revenue. Most of the support for an income tax came from southern and wester n states. Most of the opposition came from the wealthier states whose citizens would be most affected by an income tax—Massachusetts, New Jersey, New York, and Pennsylvania . After many attempts Congress finally passed a modest income tax in 1894. The Supreme Court quickly ruled it unconstitutional on the ground that it violated the constitutional provi- sion requiring that federal taxes be apportioned GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 474 INTERNAL REVENUE SERVICE equally among the various states. Supporters of the income tax overcame this hurdle in 1913, when Wyoming became the 36th state to ratify the SIXTEENTH AMENDMENT to the Constitution, giving Congress the power to collect taxes without regard to state apportionment. That same year Congress enacted the first income tax act under the amendment, and the income tax became a permanent feature of the U.S. tax system. The passage of the Sixteenth Amendment marked the beginning of an era of significant expansion for the Bureau of Internal Revenue. The establishment of the Personal Income Tax Division greatly increased bureau staff, and many new taxes were imposed to finance WORLD WAR I, thus requiring new bureau divisions and pro- grams. As the bureau’s responsibilities continued to multiply, operations became more inefficient and disorganized. In the 1920s, for example, the national office of the bureau was housed in a dozen different buildings located all around the metropolitan Washington, D.C., area. Tax returns became backlogged, tax fraud and evasion were rampant, and an extensive patronage system enabled politically appointed collectors to operate unchecked, outraging their CIVIL SERVICE staffs. Beginning in 1945 Congress and the Treasury Department began efforts to overhaul the whole tax collection system. In 1952 the Bureau of Internal Revenue was reorganized and given a new name: the Internal Revenue Service. This new moniker was intended to emphasize the agency’s focus on providing service to taxpayers. Patronage was eliminated, and power was decen- tralized, with the states being divided into seven regional districts through which all return pro- cessing, auditing, billing, and refunding would be administered. Since 1952 the IRS has continued to undergo major changes and reorganizations. Advance- ments in technology have had a tremendous effect on IRS operations, beginning with the opening of the automatic data proces sing system in Martinsburg, West Virginia, in 1962. This system revolutionized the collectio n and audit process by enabling the IRS to maintain a master file of every taxpayer’s account. More recent technological applications have changed the way taxpayers interact with the IRS. In 1995, for example, more than 14 million individuals and businesses used the IRS electronic filing pro- gram to submit their tax returns. Another approximately 685,000 taxpayers in ten states filed their TAX RETURN using their touch-tone telephone. Taxes were also paid electronically, with more than 41,000 businesses making more than $232 billion in federal tax deposits by electronic funds transfer. Over the years the IRS has faced continuing pressure from Congress and the public to adopt more reasonable enforcement policies, to pro- vide better service to taxpayers, and to protect private information more carefully. In an attempt to protect taxpayers’ rights, Congress in 1988 passed the TAXPAYER BILL OF RIGHTS (Pub. L. No. 100-647, tit. VI, §§ 6226–6247, 102 Stat. 3730–3752 [Nov. 10, 1988]), which outlines the rights and protections a taxpayer has when dealing with the IRS. Included are the right to have penalties waived if the taxpayer follows incorrect advice given by the IRS, the right to request relief when tax laws result in significant hardship, and the right to attorneys’ fees in cases where IRS employees violate the Internal Revenue Code to the detriment of the taxpayer. In 1995 the IRS administrative structure underwent a major reorganization. The seven regions that had been establishe d in 1952 were reduced to four, and management was consoli- dated, decreasing the number of districts within those regions from 63 to 33. The IRS came under close examination from Congress in the late 1990s following a series of allegations from taxpayers of improper behavior by IRS agents. In September 1997, over three days of televised hearings, the U.S. Senate Finance Committee heard a litany of horror stories: Taxpayers gave accounts of ruined lives, and IRS agents described a culture of lawlessness that included forgeries, spying, shakedowns, and cover-ups. The dramatic testimony capped a six-month committee probe into IRS misconduct. The first to testify in the open hearings were taxpayers, from business owners to an elderly priest, who told the panel how unfair IRS audits had led to DIVORCE, BANKRUPTCY, and, in some cases, years of fighting inflexible rules to correct the agency’s mistakes. Others said they paid the IRS large sums rather than fight and risk jeopardizing their businesses. Tom Savage, a 69-year-old Delaware construction company owner, told lawmakers that he paid $50,000 in fines despite the fact that the JUSTICE DEPARTMENT told the IRS that levying him was wrong. Another taxpayer, Nancy Jacobs of California, GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION INTERNAL REVENUE SERVICE 475 said that the IRS mistakenly assigned her husband a taxpayer identification number belonging to someone else but that she and her husband paid the agency $11,000 to stop enforcement actions in order to save her husband’soptome- trist practice. IRS whistle-blowers also testified. Sitting behind screens with their voices garbled elec- tronically to conceal their identities, they accused IRS management of several question- able practices: illegally snooping on private tax data, preying on vulnerable taxpayers, and unduly focusing collection efforts on lower- and middle-class taxpayers. Their chief allega- tion was that management evaluated employees based on their collection performance. Agents were pressured, they said, to seize as much taxpayer property and assets as possible, in violation of IRS policy and federal law. Jennifer Long, the only agent no t to testify behind a curtain with a voice distortion mask, said that agents ignored cheating by friends and by those with resources to fight an audit. Statistics showed that the audit rate for people with annual incomes of more than $100,000 declined from 11.41 percent to 2.79 percent between 1988 and 1995. During that same period, the audit rate for people with annual incomes of less than $25,000 nearly doubled, from 1.03 percent to 1.96 percent. In 1998 Congress passed the Internal Reve- nue Service Restructuring and Reform Act of 1998 (IRSRRA), Pub. L. No. 105-206, 112 Stat. 685 (codified in scattered sections of 26 U.S.C.A.), to overhaul operations within the IRS. Title I reorganized the structure and management of the IRS with three sections designed to improve taxpayer treatment. The act directed the commissioner to discard the IRS organizational structure, which had previ- ously run operations through local, regional, and national offices. In its place the commis- sioner was required to substitute organizational units serving taxpayers with similar tax obliga- tions, such as individuals, small businesses, large businesses, and nonprofit organizations. The IRSRRA created the Internal Revenue Service Oversight Board, which operates within the DEPARTMENT OF THE TREASURY. The Oversight Board contains nine members, including the secretary of the treasury, the commissio ners of the IRS, six civilians, and one federal govern- ment employee appointed by the president with the ADVICE AND CONSENT of the Senate. The board’s general responsibility is to oversee the IRS “in its administration, management, con- duct, direction, and supervision of the execu- tion and application of the internal revenue laws.” Although the board may not view the tax returns of individual taxpayers and, therefore, cannot rectify individual taxpayer abuse, IRSRRA commands the board to ensure that the IRS treats taxpayers properly. Under the IRSRRA, the commissioner of the IRS must terminate agency employees who engage in a list of forbidden conduct that includes the following: failing to obtain required signatures before seizing homes, personal belong- ings, and business assets to satisfy tax deficiencies; making a false statement under oath concerning a taxpayer’s case; violating a taxpayer’s constitu- tional or CIVIL RIGHTS; falsifying or destroying documents to conceal IRS mistakes; committing ASSAULT or BATTERY on a taxpayer; violating the tax laws or regulations for the purpose of retaliating against or harassing a taxpayer; and threatening to audit a taxpayer to extract a personal benefit. Although a LOOPHOLE allows the commissioner to take personnel action other than termination at his sole discretion, he may not delegate that authority to any other officer. Title III of IRSRRA contains a Taxpayer BILL OF RIGHTS , also designed to reduce taxpayer abuse. Most notably, it shifts the BURDEN OF PROOF in most tax cases to the IRS. Previously, taxpayers sued by the IRS had the burden of proving that their tax calculation was correct. Under IRSRRA, if a taxpayer keeps the appropri- ate records, cooperates during IRS investigations, and presents “credible evidence” t o support his or her tax calculation, the IRS has the burden of proving the calculation is wrong. The require- ment that the taxpayer show credible evidence has proven difficult in some cases. For example, in Higbee v. Commissioner, 116 T.C. No. 28 (2001), the U.S. TAX COURT held that the t estimony of the taxpayer and a document from a small- claims courts showing damages to a piece of property, which he alleged entitled him to a deduction, did not constitute credible evidence to shift the burden of proof to the IRS. The Taxpayer Bill of Rights also regulates IRS collection efforts and helps specific groups of taxpayers who might lack power to protect themselves. Some evidence suggests that IRSRRA reduced taxpayer abuse shortly after its enactment. By March 1999, property seizures GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 476 INTERNAL REVENUE SERVICE were down 98 percent from levels two years prior; GARNISHMENT of paychecks and bank accounts were down 75 percent; and liens, which ensure that a tax is paid when property is sold, were down 66 percent. Critics, however, contend that these figures reflect reduced, not better, enforcement efforts caused by IRS employees’ fear of losing their jobs for violating the IRSRRA. Moreover, other evidenc e, ad- dressed in a 2002 article in the New York Times, suggests that IRS agents are more likely to subject wage earners to heavy scrutiny over tax returns than they are businesses, trusts, and partnerships. FURTHER READINGS Burnham, David. 1989. A Law unto Itself: Power, Politics, and the IRS. New York: Random House. Chommie, John C. 1970. The Internal Revenue Service. New York: International Thomson. Ely, Mark H. 2003. “The ‘New’ IRS Audits.” The Tax Adviser 34 (October). Richardson, Margaret Milner. 1994. “Reinventing the Internal Revenue Service.” Federal Bar Association Section of Taxation Report 1 (winter). Treasury Department Web site. Internal Revenue Service Web site. Available online at http://www.irs.gov (accessed August 1, 2009). U.S. Department of the Treasury. Internal Revenue Service. 1996. Guide to the Internal Revenue Service. Washing- ton, D.C.: U.S. Government Printing Office. Whitman, Donald R., ed. 1983. Government Agencies. Westport, CT: Greenwood. CROSS REFERENCES Civil Service; Customs Duties; Estate and Gift Taxes; Internal Revenue Code; Pollock v. Farmers ’ Loan & Trust Co.; Taxation; Tax Court; Tax Evasion; Sixteenth Amend- ment. INTERNAL WATERS See INLAND WATERS. INTERNATIONAL COURT OF JUSTICE The International Court of Justice (ICJ) is the main judicial tri bunal of the UNITED NATIONS,to which all member states are parties. It is often informally referred to as the World Court. The ICJ was established in 1946 by the United Nations (Statute of the International Court of Justice [ICJ Statute], June 26, 1945, 59 Stat. 1055, 3 Bevans 1179). It replaced the former Permanent Court of International Justice, which had operated within The Hague, Nether- lands, since 1922. Like its predecessor, the headquarters of the ICJ is also located in the Peace Palace at The Hague. The function of the ICJ is to resolve disputes between sovereign states. Disputes may be placed before the court by parties upon conditions prescribed by the U.N. Security Council. No state, however, may be subject to the jurisdiction of the court without the state’s consent. Consent may be given by express agreement at the time the dispute is presented to the court, by prior agreement to accept the jurisdiction of the court in particular categories of case s, or by treaty provisions with respect to disputes arising from matters covered by the treaty. Article 36(2) of the court’s statute, known as the Optional Clause, allows states to make a unilateral declaration recognizing “as compul- sory IPSO FACTO and without special agreement, in relation to any other state accepting the same obligation, the jurisdiction of the Court in all legal disputes.” Many states have accepted the court’s jurisdiction under the Optional Clause. A few states have done so with certain restrictions. The United States, for instance, has invoked the so-called self-judging reservation, or Connally Reservation. This reservation allows states to avoid the court’s jurisdiction previously accepted under the Optional Clause if they decide not to respond to a particular suit. It is commonly exercised when a state determines that a particular dispute is of domestic rather than international character, and thus domestic jurisdiction applies. If a state invokes the self- judging reservation, another state may also invoke this reservation against th at state, and thus a suit against the second state would be dismissed. This is called the rule of reciprocity, and stands for the prin ciple that a state has to respond to a suit brought against it before the ICJ only if the state bringing the suit has also accepted the court’sjurisdiction. Under the ICJ Statute, the ICJ must decide cases in accordance with INTERNATIONAL LAW. This means that the ICJ must apply (1) any international conventions and treaties; (2) inter- national custom; (3) general principles recog- nized as law by civilized nations; and (4) judicial decisions and the teachings of highly qualified publicists of the various nations. One common type of conflict presented to the ICJ is treaty interp retation. In these cases the ICJ is asked to resolve disagreements over the meaning and application of terms in treaties GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION INTERNATIONAL COURT OF JUSTICE 477 . is concerned with the conservation of species threatened by loss of habitat. AP IMAGES GALE ENCYCLOPEDIA OF AMERICAN LAW, 3 RD E DITION 468 INTERIOR DEPARTMENT the failure of the BIA to provide Indians. pendency of the lawsuit. For example, an interlocutory order may require one spouse to pay the other spouse a designated w eekly sum for support, pending a GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E. Service. ILLUSTRATION BY GGS CREATIVE RESOURCES. REPRODUCED BY PERMISSION OF GALE, A PART OF CENGAGE LEARNING. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3 RD E DITION INTERNAL REVENUE SERVICE 473 Northeast, Southeast,