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Archive for National Taxpayer Advocate

Implementation Of New TAS Case Acceptance Procedures For Theft Refund Fraud Cases

National Taxpayer Advocate On Fraud

The IRS uses certain “filters” to detect and prevent tax refund fraud. While these filters do stop a substantial amount of fraud, they also flag hundreds of thousands of returns each year that turn out to be legitimate. This causes refund delays and often creates financial hardships. Notably, the filters have produced a dramatic increase in the number of taxpayers seeking TAS assistance. TAS’s non-identity theft refund fraud case receipts have increased nearly five-fold over the past three years – from about 18,500 cases in calendar year (CY) 2017 to about 92,000 in CY 2019. Moreover, about 72 percent of the case receipts for CY 2019 were accepted under TAS’s “economic hardship” criteria. I wrote about this issue in a Most Serious Problem in my 2019 Annual Report to Congress.

Some background: The IRS’s Return Integrity Verification Operations (RIVO) function operates filters designed to identify suspected identity theft and other non-identify theft related instances of fraud. One of these filters is designed to identify cases where a taxpayer files a fraudulent return in his or her own name (e.g., the taxpayer claims his employer withheld $7,000 in federal tax when the employer only withheld $3,000, which, if not detected, would cause the taxpayer to receive a refund of $4,000 more than the correct amount). This non-identity theft filter is operated, in IRS parlance, by the “Pre-Refund Wage Verification Hold” (PRWVH) program.
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The Taxpayer Advocacy Panel Is Now Recruiting Volunteers Of Citizens

National Taxpayer Advocate Recruiting Volunteers

The Taxpayer Advocate Service (TAS) is your voice at the IRS. We take this statement seriously, as demonstrated by the work we do to help taxpayers resolve their tax problems. We do more than resolve problems, however. Part of our mission is to recommend changes that will prevent problems in the future. And in keeping with that part of our mission, we provide oversight and support for the Taxpayer Advocacy Panel (TAP), a federal advisory committee made up of citizens that listens to taxpayers, identifies major taxpayer concerns, and makes recommendations for improving IRS customer service and customer satisfaction.

The panel, established in 2002, consists of about 75 volunteers. To the extent possible, TAP members come from all 50 states, the District of Columbia, and Puerto Rico. In addition, one member represents U.S. citizens working, living, or doing business abroad or in a U.S. territory other than Puerto Rico. To be a member of TAP, a person must be a U.S. citizen, be current with federal tax obligations, and pass a Federal Bureau of Investigation criminal background check. Members cannot be federally registered lobbyists. In addition, current Department of the Treasury and IRS employees cannot serve on the panel, and former Department of the Treasury or IRS employees and former TAP members must have a three-year separation from their service to be eligible for appointment. Tax practitioner applicants must be in good standing with the IRS (meaning not currently under suspension or disbarment).
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National Taxpayer Advocate: IRS Audits In Person

IRS Audits In Person

Most of the time, the IRS accepts tax returns as you file them. However, it selects some for an additional review or audit to determine if you reported your income, expenses, and credits accurately.

If the IRS selects your return for audit (also called examination), it doesn’t automatically mean something is wrong. Once the IRS completes the examination, it may accept your return as filed or propose changes. These changes may affect the amount of tax you owe (a proposed deficiency) or your refund amount.

There are two ways to be audited – by mail, or in person. This article deals with an in-person audit.

When the IRS selects your tax return for audit, it will notify you by mail. Sometimes the IRS will follow-up with you by phone about the notice it previously sent. The notice will tell you:
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Local Taxpayer Advocates Describe Most Serious Problems Experienced By Taxpayers


During February, Taxpayer Advocates Service’s Local Taxpayer Advocates (LTAs) are in Washington, D.C., presenting the National Taxpayer Advocate’s 2019 Annual Report to Senators and House Members whose local offices they serve.

The law requires TAS to place at least one LTA in every state to assist taxpayers who are experiencing problems with the IRS. Over the past seven years, TAS has received an annual average of about 218,000 cases, and an annual average of about 15,000 of these cases (roughly seven percent), have been referred by congressional offices.

To facilitate coordination, TAS pairs every Senate and House office with an LTA office within the state the Senator or House member represents. LTAs work with congressional offices by sharing information about trends they are seeing in their casework and by partnering with them to disseminate information about filing deadlines, changes in the law, and other information that may be useful for taxpayers.

Once a year, typically around the first week of February, our Local Taxpayer Advocates go to Washington for our “Congressional Affairs Program.” During this “CAP” conference, they receive training on technical issues that they bring back to their local offices and teach to the case advocates they supervise, and they visit the Washington offices of the Senators and House members whose local offices they assist.
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NTA: Sharing Economy Tax Information


Many taxpayers work or engage in services that are considered to be a part of the gig or shared economy services. These services often originate through peer-to-peer interactions such as ride-share programs, room rentals, and other freelance work.

Following the May 2016 hearing, Taxpayer Advocate Service worked with the IRS to create the information contained on the pages listed below to help you navigate the tax responsibilities which may apply when you work in the gig economy environment.

IRS Sharing Economy Tax Center
Watch video from the May 2016 House Small Business Committee testimony on the Sharing Economy: A Taxing Experience for New Entrepreneurs, Part I and Part II.

Related Articles: Self Employment Taxes

How To Confirm The Identity Of An Internal Revenue Service Field Revenue Officer If They Come Knocking At Your Door

IRS Visits Your Home

The Internal Revenue Service (IRS) has begun conducting face-to-face meetings with individual and business taxpayers as a part of a special compliance effort entitled Revenue Officer Compliance Sweep (ROCS). This is an extremely high priority effort where IRS field revenue officers (RO’s) will be working to resolve compliance issues, including missing tax returns and taxes owed, with a special emphasis on payroll taxes.

The RO’s will visit areas where there is little to no IRS presence. They will interview taxpayers while gathering financial information to help them become compliant now and remain so in the future. The new effort began Wisconsin, Texas, and Arkansas and will eventually rollout nationwide.

To avoid confusion with IRS scam artists and other imposters, the IRS will announce general details about these efforts in specific locations as an important step to raise community awareness around IRS activity during a specified time.

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National Taxpayer Advocate Reports Most Serious Problems At The Internal Revenue Service

NTA Reports Most Serious Problems At IRS
Most Serious Problems At IRS

Section 7803 (c)(2)(B)(ii) of the Internal Revenue Code, as amended by the Taxpayer First Act (TFA), requires the National Taxpayer Advocate to submit this report each year and to include in it, among other things, a description of the ten most serious problems encountered by taxpayers as well as administrative and legislative recommendations to mitigate those problems. Previously, the report was required to contain a description of at least 20 of the most serious problems facing taxpayers. This year’s report, per the TFA, includes the 10 Most Serious Problems. These issues can affect taxpayers’ basic rights and the ways they pay taxes or receive refunds, even if they’re not involved in a dispute with the IRS.

As your voice at the IRS, the National Taxpayer Advocate uses the Annual Report to elevate these problems and recommend solutions to Congress and the highest levels of the IRS.

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National Taxpayer Advocate Releases Annual Report To Congress

National Taxpayer Advocate Report to Congress

The National Taxpayer Advocate submitted to Congress the 2019 Annual Report to Congress and the third edition of the National Taxpayer Advocate’s Purple Book, which presents legislative recommendations designed to strengthen taxpayer rights and improve tax administration for all taxpayers.

Section 7803(c)(2)(B)(ii) of the Internal Revenue Code (IRC), as amended by the Taxpayer First Act, dictates that the National Taxpayer Advocate submit a report to Congress each year describing the 10 most serious problems encountered by taxpayers and making administrative and legislative recommendations to mitigate those problems. The 2019 Report to Congress and the Purple Book do just that by identifying problems, making dozens of recommendations for administrative change, making 58 recommendations for legislative change, and analyzing the tax issues most frequently litigated in federal courts.

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IRS Publication Error May Have Caused Certain Married Taxpayers Filing Separately To Fail To File Required Tax Returns

TAS’s statutory mission is to resolve problems taxpayers encounter as a result of the way the IRS administers the nation’s tax code. In this blog, I would like to call attention to TAS’s efforts to correct an error in an IRS publication that may have led some taxpayers with a filing requirement to fail to file their returns.

Under section 6012(a) of the Internal Revenue Code (IRC), the filing threshold for married taxpayers filing separate returns from their spouses is the personal exemption amount, which was $4,050 in tax year (TY) 2017. In December 2017, the Tax Cuts and Jobs Act of 2017 (TCJA) suspended the personal exemption for TYs 2018-2025 (effectively reducing it to zero). As a result, taxpayers using this filing status face a filing requirement regardless of whether they worked or earned income in TYs 2018-2025. In light of Congressional intent underlying the TCJA, the IRS provided relief to married taxpayers filing separately by setting the filing requirement at $5. Both the IRS web site and the 2018 Instructions to Form 1040 indicate that a married filing separately taxpayer must file a tax return if the individual’s gross income is at least $5.

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National Taxpayer Advocate: Planning To Travel Outside The U.S. This Year? Don’t Risk A Passport Revocation

National Taxpayer Advocate

The Internal Revenue Service is urging taxpayers to resolve their significant tax debts, $50,000 or more, to avoid putting their passports in jeopardy. If you owe $50,000 or more and haven’t made payment arrangements, please contact the IRS now to avoid travel delays later.

Why is the State Department allowed to limit or revoke my passport due to unpaid taxes?

In December 2015, Congress passed the Fixing America’s Surface Transportation (FAST) Act. That act authorized the IRS to certify to the State Department taxpayers who owe a seriously delinquent tax debt. A seriously delinquent tax debt is an unpaid, legally enforceable federal tax debt totaling more than $50,000 (Please note that this amount is adjusted annually for inflation.) for which a notice of federal tax lien has been filed and all administrative remedies under IRC § 6320 have lapsed or been exhausted, or a levy has been issued. The IRS began certifying these debts to the State Department in 2018. Under the law, the State Department must deny your passport application and may revoke or limit your passport if the IRS has certified you as having a seriously delinquent tax debt. A seriously delinquent tax debt does not include non-tax debts collected by the IRS, such as the FBAR penalty and child support.

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IRS Agrees To Temporary Exclusion From The Passport Certification Program For TAS Cases

National Taxpayer Advocate

In my first blog as the Acting National Taxpayer Advocate, I’d like to address a topic that has been in the news a good deal over the past year—“passport certification.”  Under section 32101 of the FAST Act, if the IRS “certifies” a taxpayer as having a “seriously delinquent tax debt” (currently more than $52,000 and meeting certain other requirements under Internal Revenue Code (IRC) § 7345(b)), the Department of State must deny the taxpayer’s passport application (original or renewal) and may revoke or limit an existing passport.

Previous National Taxpayer Advocate blogs have discussed aspects of the passport certification program, including the lack of a stand-alone notice issued to taxpayers before the IRS certifies their debts and the IRS’s refusal to hold off on certifications while taxpayers are working with TAS to resolve their liabilities.

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National Taxpayer Advocate Objectives Report Features IRS Responses To Most Serious Problems (Volume 2)

National Taxpayer Advocate

Each December, the National Taxpayer Advocate identifies the Most Serious Problems facing taxpayers and makes recommendations for addressing them in the Annual Report to Congress (ARC). Each June, the National Taxpayer Advocate submits the Objectives Report to Congress, which includes a second volume that contains the IRS’s responses to our recommendations together with our analysis of the IRS’s responses.

As the Acting National Taxpayer Advocate, I believe it is important for taxpayers, tax practitioners, and Members of Congress to see how the IRS responded, and I will highlight a few examples of its responses and related analysis.

  • Most Serious Problem 1 – Tax Law Questions: The IRS has agreed to study the feasibility of returning to its previous practice of answering in-scope tax law questions year-round on the phones.
  • Most Serious Problem 2 – Chief Counsel Transparency: IRS Counsel has agreed to clarify the standards that should be considered when deciding whether legal advice should be issued in a formal memorandum.

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