It has been decided that most of these hybrid suits should be processed the same as the ordinary general litigation collection cases, i.e. , the regional defense letter. Questions and telephonic contacts in these cases should be referred to General Litigation. However, the field office should coordinate the case between the two functions, i.e. , General Litigation and General Legal Services, in the field and indicate such coordination either by the initialed copy or on the transmittal form. It may be helpful in these situations to consult pertinent provisions of the General Legal Services Manual. General Litigation is responsible for four civil causes of action for damages against the Service.
Damages are limited to actual, direct economic damages, plus the cost of the action.
There is no cap on damages, but taxpayer must mitigate. The statute of limitations is two years after accrual of the right of action. The statute of limitations is two years after the accrual of the right of action. See CCDM 34.10.32. This does not apply to information conveyed to a tax professional for the purpose of perpetrating a fraud or crime.