PROOF Act

The PROOF Act establishes new procedural requirements for the IRS when examining and potentially revoking the tax-exempt status of organizations under section 501(a), excluding churches from some specific notice provisions but extending other rights to them. The bill mandates that the IRS provide detailed written notices outlining the scope of an examination, the legal basis for it, and the organization's right to representation before beginning any review. It requires the agency to maintain a comprehensive record of the examination process, which must be disclosed to the organization upon request, and limits information requests to those with clear relevance and sufficient response time. Additionally, the legislation grants organizations the right to hold conferences with supervisory agents during disputes and provides a mandatory 30-day period after receiving a proposed adverse determination letter before a final decision can be issued, allowing time for protests or appeals through the IRS Independent Office of Appeals.