Last week in Denver, Colorado, the IRS quietly paraded out some of their race horses to share what is happening under the new administration. With Steven Mnuchin‘s most recent confirmation as Treasury Secretary and Commissioner Koskinen’s days numbered, a sense of being rudderless was anticipated.
Knowing that a hiring freeze and location consolidation are adversely impacting morale, strangely enough the general feel in the room was I’m told a lot like – oh hell a job with awesome government benefits is still a job with awesome government benefits. And, no one on the other side of the table seemed angry about this cavalier attitude according to a mole in the room.
Besides we all live in Colorado, the BEST state in the Union. So everyone seemingly got along; *Puff the Magic Dragon*, *Kumbaya*, *Group Hug*, Blah Blah Blah…
Hold your horses folks! Yesterday it was announced that:
Because of recent instructions from the Trump administration regarding the government regulatory process generally, the IRS will not be releasing any guidance — including revenue procedures and revenue rulings — beyond the most routine items for a while.
A WHILE?? NO GUIDANCE FOR … A WHILE?!?!?! How exactly then are those of us in the trenches defending taxpayers supposed to do OUR JOBS without ‘guidance’ from the beastly machine? Well the following dedicated public servants each had the opportunity to spin their own plates and trench with presentations summarized below.
Diane Sandoval, Territory Manager, Collection
I like Diane. She led off with three alarming data points:
- Nationally, the number of Field Collection Revenue Officers has declined by 42%. In 2010 they had 4068 Revenue Officers which is down to 2348 as of 2016.
- $59 billion is the approximate amount due from IRS Form 941 (Employment Tax) delinquencies as of September 2015.
- An estimated 500 companies in Colorado were injured by nefarious payroll service providers in 2016.
To address these challenges Ms. Sandoval identified 4 IRS Field Collection initiatives:
- The Early Interaction Initiative – intended to address taxpayers who are not paying taxes withheld in trust.
- The Federal Tax Deposit Alert X Coded Pilot Initiative – intended to test whether accelerating the timing of alerts increases impact and identifies which taxpayers benefit most from alerts. Federal Tax Deposit Alert cases are a proactive effort to resolve cases.
- EFTPS Early Alerts Initiative – intended to modify the Federal Tax Deposit (FTD) payment platform to create a near real-time system to identify variances in FTDs.
- Dual Notice Initiative – intended to notify the taxpayer and their representative if a change has been made to the taxpayer’s account.
Ms. Sandoval went on to discuss third party collections specifically addressing my concern – How do Tax Practice Professionals explain to taxpayers this is not a scam? The following not so calming rhetorical quip was provided in response.
The taxpayer will be sent a notice telling them that their account is going to one of these third-party collection companies. These collection companies must respect the FTC consumer rules.
Clearly someone has not had first hand experience with debt collectors as she managed to deliver this quote without flinching I was told. Either way be sure to check out the list of Private Debt Collectors.
What I do like about her is that I have her phone number and she will take my phone call. Unfortunately I got out of collections work a while ago – didn’t have the stomach for it…
Tamara Hobson, of Automated Collections
Basically her team runs the computer systems that poop out those nasty letters and manages a phone bank to field phone calls from irate taxpayers. She too presented three relatively alarming revelations.
- ACS hold times have ranged from 90 minutes to three hours and often include a courtesy hang-up.
- 508 tax examiners were expected to be hired with the intent of decreasing these hold times. The federal hiring freeze by President Trump jeopardizes this effort and hold times are expected to get worse.
- The department is ramping up to poop out an estimated 90,000 letters in Colorado alone starting in May.
Candidly there is nothing like sitting on hold listening to RIDICULOUS HOLD MUSIC for 90 minutes only to be afforded the luxury of a ‘courtesy hang-up’ to appreciate one’s 2nd amendment rights” quipped my mole.
Maria Cameron and Sean Schweiger, Taxpayer Advocate
As we all know this department is COMPLETELY WORTHLESS and not even worth mentioning. Kill me NOW if I ever may be inclined to work in this once great, now pathetic, department.
Heath Beckett, Appeals
I like Heath. He dons a pony tail in an army of business suits and can command a room full of pencil necks. Appeals implemented three new policies:
1. Initial conference procedure (ICP) – Appeals Officers have 45 days to contact the taxpayer. In the past that could have been as long as six months to notify the taxpayer that an appeals officer had the case.
2. Docket Exam Assistance (DEA) – Appeals Officers may receive new information from a petitioner/representative or counsel of record on a docketed case that in the judgment of the assigned Appeals Technical Employee (ATE) merits additional analysis or investigation by Compliance. When new information is received in Appeals in a non-docketed case, Appeals can return the case and release jurisdiction to the originating function. However, that is not possible for docketed cases. By statute, the jurisdiction of a docketed case must remain within the Office of Chief Counsel (or Appeals, if referred for settlement).
3. Conference techniques (CT) is when all appeals cases will default to a telephone conference. There are some exceptions to the telephone conference. The exceptions are:
- Substantial books and records
- Special needs such as hearing-impaired.
- Numerous witnesses
- Alternative procedures such as Fast Track
- Virtual meeting
- Case related assistance which involves two appeals officers
Steven Osborne, Criminal Investigation
Criminal Investigation has the same staffing challenges as everyone else including:10 POD’s with no agents, 51 POD’s reduced to one agent, 21 POD’s closed, 41 groups with no professional support. The 7 focuses of criminal investigation include:
- employment tax fraud,
- questionable return preparer fraud,
- frivolous programs,
- public corruption,
- counter terrorism and
- financial crimes.
Criminal investigation currently has three classes of 24 in training now. The Denver Field Office will get four of the new trainees and 10% of the budget is to fight drug trafficking. DRUG TRAFFICKING – We live in Colorado! Isn’t trafficking the same as transporting, aka a COST OF GOOD SOLD! What a waste of budget resources!
Matthew Houstsma, Counsel
Counsel’s focus has been a marijuana case which was tried in January. Matt was mysteriously quiet about how the trial went, I suspect not good. No idea when this is going to print.
Interestingly enough some of the small cases under $50,000 are now going to be handled by paralegals – PARALEGALS – who can evidently resolve cases more quickly allowing attorneys to focus on high dollar cases involving captive insurance claims, etc.
Debbie Rodgers, Stakeholder Liaison
The IRS updated three sets of Questions and Answers related to information reporting requirements and shared responsibility provisions for employers. They are now posted on the Affordable Care Act Tax Provisions Questions and Answers page on IRS.gov:
1. Information Reporting by Employers on Form 1094-C and Form 1095-C – These Q&As provide additional information about completing Form 1094-C and Form 1095-C for calendar year 2016 that are to be filed in 2017. The Q&As may be used in conjunction with the Instructions for Forms 1094-C and 1095-C, which provide detailed information about completing the forms.
2. Reporting of Offers of Health Insurance Coverage by Employers – Certain employers are required to report to the IRS information about whether they offered health coverage to their employees and if so, information about the coverage offered. This information also must be provided to employees. These Q&As address these reporting requirements.
3. Employer Shared Responsibility Provisions Under the Affordable Care Act– The Affordable Care Act added the employer shared responsibility provisions under section 4980H of the Internal Revenue Code. These updated Q&As provide information about the employer shared responsibility provisions.
This Enrolled Agent is of the opinion that Treasury Secretary Mnuchin will ask for and receive a relatively large enforcement budget increase for the IRS.