TAS AREAS OF FOCUS
- Establishing less draconian and more reasonable “settlement initiatives” for the millions of taxpayers who have legitimate reasons for overseas bank and financial accounts and whose failure to file reports was merely negligent.
Read more below:
WASHINGTON — National Taxpayer Advocate Nina E. Olson today released her statutorily mandated mid-year report to Congress that identifies the priority issues the Taxpayer Advocate Service (TAS) will address during the upcoming fiscal year. The report expresses particular concern about the impact of budget cuts on the IRS’s ability to meet taxpayer needs, the IRS’s unwillingness to issue full refunds to victims of tax return preparer fraud and shortcomings in IRS procedures for assisting victims of tax-related identity theft.
In addition, Olson released a special report examining the IRS’s use of questionable criteria to screen applicants for tax-exempt status. The special report analyzes the sources of the problem and makes preliminary recommendations to address them.
“Today, the IRS is an institution in crisis,” Olson wrote. “In my view, however, the real crisis is not the one generating headlines. The real crisis facing the IRS — and therefore taxpayers — is a radically transformed mission coupled with inadequate funding to accomplish that mission. As a consequence of this crisis, the IRS gives limited consideration to taxpayer rights or fundamental tax administration principles as it struggles to get its job done.”
TAS AREAS OF FOCUS
The report identifies the priority issues on which the Office of the Taxpayer Advocate will focus during the upcoming fiscal year. The report describes numerous challenges facing the IRS, including:
- Relieving the financial harm suffered by victims of tax return preparer fraud.
- Conducting adequate oversight of the tax return preparer industry.
- Providing effective, timely and taxpayer-centric relief to victims of identity theft.
- Utilizing effective and timely collection alternatives to minimize taxpayer burden while reducing the number and dollar amount of balance-due accounts.
- Conducting education and outreach to taxpayers about their responsibilities under the Affordable Care Act.
- Resolving erroneous revocations of the tax-exempt status of small § 501(c)(3) organizations and failing to provide them with a pre-revocation administrative appeal.
- Establishing less draconian and more reasonable “settlement initiatives” for the millions of taxpayers who have legitimate reasons for overseas bank and financial accounts and whose failure to file reports was merely negligent.
Olson expresses particular concern about the impact of cuts to the IRS budget on taxpayer services, taxpayer rights and revenue collection. She recommends that Congress provide sufficient funding for the IRS to meet taxpayer needs. Notably, she recommends that funding be restored for employee training, which has been cut by 83 percent since FY 2010, so IRS employees obtain the education and professional skills they require to administer the tax system in a manner that respects taxpayers’ rights. “The last thing a financially struggling taxpayer should have to face is an under-trained IRS collection apparatus,” she wrote.
SPECIAL REPORT ON EXEMPT ORGANIZATION REVIEW CONCERNS
In addressing the exempt organization (EO) issues, the Advocate’s office does not have investigative authority and did not seek to duplicate other ongoing investigations. The report takes a broad look at factors that contributed to the use of questionable screening criteria and processing delays and offers 16 recommendations to address them. The report groups the contributing factors into four categories: (1) lack of guidance and transparency; (2) absence of adequate checks and balances; (3) management and administrative failures; and (4) EO’s “cultural difficulty” with TAS.
Among other things (and as noted below), Olson recommends that Congress enact a Taxpayer Bill of Rights. In her preface to the report, she details how the EO review processing delays violated 8 of those 10 taxpayer rights.
LACK OF GUIDANCE AND TRANSPARENCY
The Legal Standard “Primarily” Is Vague and Undeveloped. Section 501(c)(4) of the tax code provides that an organization may qualify for tax-exempt status if it is “operated exclusively for the promotion of social welfare” (emphasis added). Treasury regulations provide that an “organization is operated exclusively for the promotion of social welfare if it is primarily engaged in promoting in some way the common good and general welfare of the people of the community” (emphasis added).
Leaving aside the question how “exclusively” came to be defined as “primarily” (which is viewed by some commentators as merely 51%), there is very little guidance to guide IRS employees in determining whether an organization is operating “primarily” for social welfare purposes or what level of political campaign activity is permissible. Among the open questions:
- Is there a fixed percentage that should be used to measure whether an entity is “primarily” engaged in social welfare activities (e.g., 51 percent)?
- What factor or factors are controlling? In seeking to measure whether an entity is “primarily” engaged in social welfare activities, one could focus on the percentage of the entity’s expenditures, the percentage of the entity’s time, the percentage of the entity’s email blasts or advertisements or other factors.
- If the IRS considers multiple factors, should all factors receive equal weight, and if not, how should the relative weighting be determined?
The law provides no direct guidance to answer these questions. To enable the IRS’s EO function to evaluate applicants for Section 501(c)(4) status in a consistent manner, the Advocate recommends that Congress or the Treasury Department provide clearer standards.
No Judicial Review Is Available for Rejected or Unanswered Section 501(c)(4) Applicants. If an organization’s application for Section 501(c)(3) status is rejected or not answered after 270 days, the organization may go to court to request a declaratory judgment. Applicants for Section 501(c)(4) status have no such right. The Advocate’s report recommends that Congress authorize judicial recourse for Section 501(c)(4) applicants. Doing so would give organizations that believe they have been unfairly treated by the IRS the right to an independent review, and it would enable the courts to assist in developing guidelines that would help the IRS in applying the “primarily” standard.
The Application Form for Section 501(c)(4) Organizations Does Not Ask Key Questions. Applicants for tax-exempt status under Section 501(c)(4) must complete IRS Form 1024, Application for Recognition of Exemption Under Section 501(a). This form was last updated in 1998 — long before the IRS began to receive a significant number of applications from organizations that intend to engage in some political campaign activity. The Advocate recommends the IRS revise the questions on Form 1024 to elicit necessary information upon application. Doing so would reduce the need for the IRS to burden organizations with subsequent requests for information and would eliminate the appearance of partisanship, since the questions would be posed to all applicants engaging in any political campaign activity.
The IRS Rarely Audits the Operations of Section 501(c)(4) Organizations to Determine Whether They Are, In Fact, Operating “Primarily” for Permissible Purposes. If the IRS is expected to ensure that organizations granted Section 501(c)(4) status operate as they say they will, it must have the ability to conduct periodic audits. To ensure the IRS’s decisions about which organizations to audit are objective, the Advocate recommends the IRS conduct a small sample of reviews and then develop a risk model to use in compliance reviews of organizations after they have begun operations. The IRS can use the information developed in these audits to improve guidance and create outreach and education campaigns.
The EO Function Did Not Post Its Procedures on the Internet, Potentially Violating the Law and Contributing to the Problem. The IRS is required to post on its website all “instructions to staff that affect a member of the public,” unless an exemption applies. Even if an exemption applies, IRS functions should clear most guidance internally with affected program owners and “specialized reviewers” such as TAS. EO did not clear with TAS or post on the Internet, even in redacted form, relevant training materials, form letters used to request additional information, the screening checksheet used by EO employees in the determinations process and other key documents. EO’s failure to clear its procedures with TAS and other stakeholders bypassed an important safeguard of taxpayer rights.
Had these documents been vetted by TAS, TAS would have had an opportunity to raise concerns before implementation. Had these documents been posted on the Internet, members of the public would have had access to them, providing greater transparency and enabling them to raise concerns about improper practices. Key EO documents still are not posted to the Internet, and TAS has not been able to locate them on the IRS intranet. The Tax Exempt and Government Entities Division (TE/GE), of which EO is a part, has agreed to share its guidance with TAS. The Advocate recommends that the IRS adopt more expansive disclosure policies both in TE/GE and throughout the IRS.
ABSENCE OF ADEQUATE CHECKS AND BALANCES
The IRS’s Processing of Section 501(c)(4) Applications Violated Fundamental Taxpayer Rights. The National Taxpayer Advocate has long recommended that Congress enact a Taxpayer Bill of Rights (TBOR). Modeled after the U.S. Constitution’s Bill of Rights, they would include the following: (1) the right to be informed; (2) the right to be assisted; (3) the right to be heard; (4) the right to pay no more than the correct amount of tax; (5) the right of appeal; (6) the right to certainty; (7) the right to privacy; (8) the right to confidentiality; (9) the right to representation; and (10) the right to a fair and just tax system. The intent of a Taxpayer Bill of Rights is not primarily to create new rights, but to group the dozens of existing taxpayer rights into categories that members of the public and IRS employees alike can understand and remember. In her preface to the report, Olson details how the IRS’s processing of Section 501(c)(4) applications violated 8 of these 10 rights. “If these rights were enacted and publicized . . . applicants for exemption may have complained more promptly and the violations might have been addressed more quickly,” the report says.
Applicants for Exempt Status (and Other Taxpayers) Have No Easily Available Remedy for the Violation of Their Rights. Several other countries, notably Australia and the United Kingdom, have authorized “apology payments” (or an equivalent) as a remedy for the violation of taxpayer rights. The National Taxpayer Advocate has previously proposed that Congress authorize the Advocate to make a payment of up to $1,000 to a taxpayer in cases where the action or inaction of the IRS caused excessive expense or undue burden and the taxpayer has experienced a “significant hardship” within the meaning of Section 7811 of the tax code. The total would be capped, perhaps at $1 million per year. Apology payments would serve as a symbolic gesture to show that the government recognizes its mistake and the taxpayer’s burden. The Advocate recommends that Congress enact this proposal.
Congress No Longer Holds Joint Annual Oversight Hearings to Review IRS Challenges and Performance. After Congress passed the IRS Restructuring and Reform Act of 1998, it held annual oversight hearings to review the IRS’s performance. Each hearing was conducted jointly by majority and minority members of the House Committees on Ways and Means, Appropriations, and Government Reform and Oversight and the Senate Committees on Finance, Appropriations, and Governmental Affairs. The last joint oversight hearing was held about 10 years ago. The Advocate recommends that Congress reinstate joint annual oversight hearings to help identify and address problem areas, with specific focus on how the IRS is meeting the needs of particular taxpayer segments, including individuals, small businesses and exempt organizations, and how it is protecting taxpayer rights.
MANAGEMENT AND ADMINISTRATIVE FAILURES
EO Management Did Not Maintain an Adequate Inventory Management System. EO apparently did not have the meaningful performance measures required for effective management oversight, such as how long it takes, on average, to process applications that cannot be disposed of during initial screening and what percentage of inventory was over-aged. The Advocate recommends that EO adopt better metrics to enable management to identify problems more quickly.
EO Management Did Not Ensure that Requests for Guidance Received a Timely Response. The recent report by the Treasury Inspector General for Tax Administration (TIGTA) report found that “the Determinations Unit waited more than 20 months (from February 2010 to November 2011) to receive draft written guidance from the Technical Unit for processing potential political cases.” It appears EO management did not have a system to ensure management followed up on requests for guidance or assistance that were not timely fulfilled. The Advocate recommends that EO track requests for guidance or assistance from the EO Technical Unit so management can assess the timeliness and quality of the guidance and assistance it provides to both Determinations Unit employees and the public.
EO’S CULTURAL DIFFICULTY WITH TAS
EO Executives Resisted TAS’s Authority to Order Expedited Processing of Tax-Exemption Applications, and Thereby Isolated EO from TAS. Congress has given the National Taxpayer Advocate the authority to issue Taxpayer Assistance Orders (TAOs) directing the IRS to take an action or refrain from taking an action with respect to taxpayers who have experienced a “significant hardship” as defined by statute. When EO’s backlog of applications for exempt status grew around 2007, TAS issued TAOs directing EO to process certain “significant hardship” cases quickly. EO management pushed back, arguing that the Advocate’s authority to issue TAOs did not apply to EO cases. The attitude that EO does not have to be responsive to TAS has permeated EO and persists to this day, the report says. The Advocate has recommended and the new TE/GE leadership has agreed that TAS provide training to EO employees regarding TAS’s authority to order expedited processing of exemption applications.
EO Employees Did Not Refer Over-Aged Cases to TAS. The tax code provides that the National Taxpayer Advocate shall “develop guidance to be distributed to all Internal Revenue Service officers and employees outlining the criteria for referral of taxpayer inquiries to local offices of taxpayer advocates.” One criterion is that “[t]he taxpayer has experienced a delay of more than 30 days [beyond the IRS’s normal processing time] to resolve a tax account problem.” Although other IRS divisions routinely refer cases to TAS and although every case identified by TIGTA was delayed much more than 30 days, EO did not refer any of these cases to TAS. The Advocate has recommended and the new TE/GE leadership has agreed that TAS provide guidance and training to EO employees regarding when to refer cases to TAS.
EO Employees Did Not Report the Systemic Delays in EO Processing to TAS. TAS maintains a system known as the Systemic Advocacy Management System (SAMS) through which IRS employees and members of the public can report systemic IRS problems. TAS receives hundreds of submissions each year, including many from IRS employees. However, no EO employee (or anyone else) alerted TAS to this issue while the cases were on hold. Had TAS been alerted, it would likely have uncovered the significant delays and confusion in processing these applications during the pendency of the problem. The Advocate recommends that TAS provide guidance and training to EO employees regarding when to refer systemic issues to TAS.
TAS CASES
Following the release of the TIGTA report, TAS searched its databases for the period from January 1, 2010 through May 17, 2013. It identified 19 cases that may have involved the “Be on the Lookout” (BOLO) selection criteria out of over 915,000 total case receipts during that period. The 19 cases were received by ten TAS offices in nine states. Eleven organizations were granted exempt status, three withdrew their applications, three cases were closed because the applicants did not respond to requests for additional information, and two cases are still open in EO and are assigned to a reviewer.
The report says that faced with an average of more than 270,000 cases a year, it is difficult for TAS to identify systemic issues that arise in a small number of cases. However, the report says steps can be taken to increase the odds of earlier issue identification. As described above, EO leadership has agreed to allow TAS to train its employees regarding case referrals and SAMS submissions. If TAS had received a significant number of case referrals from EO or if the systemic processing delays had been reported on SAMS by any EO employee who was aware of the issue, TAS likely would have identified the problem sooner. In addition, the National Taxpayer Advocate will provide additional training to TAS employees regarding EO issues, and TAS will participate in a task force with TE/GE to identify and address systemic EO issues in the future.
* * * * * * *
The National Taxpayer Advocate is required by statute to submit two annual reports to the House Committee on Ways and Means and the Senate Committee on Finance. The statute requires these reports to be submitted directly to the Committees without any prior review or comment from the Commissioner of Internal Revenue, the Secretary of the Treasury, the IRS Oversight Board, any other officer or employee of the Department of the Treasury, or the Office of Management and Budget. The first report is due on June 30 of each year and must identify the objectives of the Office of the Taxpayer Advocate for the fiscal year beginning in that calendar year. The second report, due on December 31 of each year, must identify at least 20 of the most serious problems encountered by taxpayers, discuss the ten tax issues most frequently litigated in the courts and make administrative and legislative recommendations to resolve taxpayer problems.
ABOUT THE TAXPAYER ADVOCATE SERVICE
The Taxpayer Advocate Service is an independent organization within the IRS. TAS employees help taxpayers who are experiencing financial difficulties, such as not being able to provide necessities like housing, transportation or food; taxpayers who are seeking help in resolving problems with the IRS; and taxpayers who believe an IRS system or procedure is not working as it should. If you believe you are eligible for TAS assistance, call 1-877–777–4778 (toll-free). For more information, go to www.TaxpayerAdvocate.irs.gov or www.irs.gov/advocate. You can get updates on tax topics atwww.facebook.com/YourVoiceAtIRS, Twitter.com/YourVoiceatIRS and www.youtube.com/TASNTA.
Related Items:
- National Taxpayer Advocate’s FY 2014 Objectives Report to Congress & Special Report
- Tax Toolkit: www.TaxpayerAdvocate.irs.gov
In summation: “No accountability” for anything the IRS does! Its agents are free to screw up, harass, make mistakes, give out $20 billion+ in fraudulent claims, spend lavishly on conference and parties with taxpayers money, and simply say “sorry” at the end – or worse, merely claim they are innocent and then invoke the 5th Amendment and refuse to answer Congress’ questions on anything they do. Even those who admit they made mistakes have no actions taken against them – they don’t lose their jobs; they don’t pay fines; they don’t go to jail; they merely get moved and given promotions and bonuses. This is the very definition of “Orwellian”.
More reasonable settlement initiatives would deprive the IRS of penalty revenue. They aren’t likely to happen. There is a reason why most U.S. citizens abroad are not in tax compliance – the incentives to be so are not there.
The latest audit by the TIGTA…
IRS Purchase Card Program Needs Better Oversight
To not put too fine a point on it, this is basically talking about IRS management misusing their IRS issued credit cards. Of course, they would not point that out. The Leadership is corrupted. Oh, but it is getting better. I bet the FATCAnatics running around in Europe working on IGAs having fun are the Biggest offenders!
and on the TAS report…
Sadly, if anyone reads it, the only thing they will see is the message. “We need more money and resources”
That is the IRS release. Go to the link at the bottom to the Tax Advocate page
http://www.taxpayeradvocate.irs.gov/2014ObjectivesReport
OVDI summary
http://www.taxpayeradvocate.irs.gov/userfiles/file/FullReport/IRS-Offshore-Voluntary-Disclosure-Programs-Continue-to-Burden-Benign-Actors-and-Damage-IRS-Credibility.pdf
The summary goes part way in the discussion /// asking to MINIMIZE problems rather than to FIX the problems.
I feel even more grateful to the TAS than before. On page 38, it is stated that the TAS helped 474 taxpayers with OVD issues and issued 4 TAOs related to OVD issues. Only one of them was accepted – mine. The TAO is described in
http://isaacbrocksociety.ca/2013/06/16/an-irs-ovdi-ordeal-with-a-happy-ending-an-opt-out-success-story-as-told-by-not-that-lisa/comment-page-2/#comment-406320
What one can also learn from that is that a TAO needs to be really simple for the IRS to comply. I am not sure if that is good or bad considering how complex the IRS often makes things.
Please define TAO (people that work in big companies become very good at knowing all the 3 letter abbreviations — until their Company is bought out by a bigger Company and everybody has to then learn all the new 4-letter abbreviations)
“The newly appointed acting head of the Internal Revenue Service said Monday that the agency does not need more money to carry out the responsibility of processing applications for tax-exempt status, despite calls during the hearing for increased funding to help the embattled agency’s workload.
“The solution here is not more money,” IRS acting Commissioner Daniel Werfel told lawmakers during a House Appropriations subcommittee hearing, his first public appearance before lawmakers since being named acting commissioner last week. “If you start with more money, that’s the wrong starting point.”
…”Werfel vowed that under his watch, the IRS would find out who was responsible for the agency’s practices.
“We have to get to the bottom of that,” he said. “We will uncover every fact.”
http://news.yahoo.com/blogs/ticket/acting-head-irs-says-agency-does-not-more-210618673.html
Taxpayer Assistance Order – IRM 13.1.20.1 The Internal Revenue Code under IRC 7811 authorizes the National Taxpayer Advocate (NTA) to issue a Taxpayer Assistance Order (TAO) when a taxpayer is suffering or is about to suffer a significant hardship as a result of the manner in which the internal revenue laws are being administered.
13.1.20.2 (02-01-2011)
Determining When to Issue a Taxpayer Assistance Order
Pursuant to Delegation Order 13-1 (formerly DO-232) and IRM 1.11.4.2(2), Types of Delegation of Authority, the authority to issue a TAO is delegated to Area Directors (ADs), Local Taxpayer Advocates (LTAs), the Executive Director, Case Advocacy (EDCA), and the Deputy National Taxpayer Advocate (DNTA). These officials have the delegated authority to issue, modify, or rescind a TAO.
A TAO will be considered when all of the following factors are present:
the taxpayer is suffering or about to suffer a “significant hardship” if relief is not granted; and
the significant hardship results from the manner in which the IRS is administering the law, and
TAS does not have the authority to take the actions needed to grant relief to the taxpayer or to resolve a case issue, and
the Operating Division or Function (OD/Function) does not agree with TAS on the proper resolution of specific case issues, or the IRS fails to perform the actions recommended by TAS.
A significant hardship includes:
an immediate threat of adverse action;
a delay of more than 30 days in resolving taxpayer account problems;
the incurring by the taxpayer of significant costs (including fees for professional representation) if relief is not granted;
irreparable injury to, or a long-term adverse impact on, the taxpayer if relief is not granted.;
a serious privation caused or about to be caused to the taxpayer as a result of the particular manner in which the revenue laws are being administered by the IRS per Treas. Reg. § 301.7811-1(a)(4)(ii).
Note:
The regulation states that serious privation is more than mere economic or personal inconvenience.
In cases where any IRS employee is not following applicable published administrative guidance (including the IRM), TAS must analyze the factors taken into account in determining whether to issue a TAO in the manner most favorable to the taxpayer. See IRC 7811(a)(3).
Well, that is a surprise… “If you start with more money, that’s the wrong starting point.”
Is some common sense coming to play?
We can only hope, Just Me. At least this Commissioner can actually admit there are problems. Werfel does seem intent on at least listening to the NTA:
“The attitude that [Exempt Organizations] does not have to be responsive to [the taxpayer advocate] permeated the organization and persists to this day, with one EO employee recently complaining about being ‘so tired of you calling,'” the report said.
…”The IRS’ acting commissioner, Danny Werfel, promised to work with Olson’s office “to improve education inside and outside the IRS about taxpayer rights.”
More:
http://www.cleveland.com/business/index.ssf/2013/06/irs_fought_oversight_in_tea_pa.html
NTA suggest the IRS make ‘apology payments’ to taxpayers:
“The rationale for an apology payment is not to compensate the taxpayer fully for his or her time and frustration, but to serve as a symbolic gesture to show that the government recognizes its mistake and the taxpayer’s burden,” Olson said. “These payments might enhance the public perception of the IRS and the tax system as just and fair.”
http://www.lohud.com/usatoday/article/2457923
What’s Nina been smoking?
Note this new entry on Jack’s blog. Sound familiar?
New Taxpayer Advocate Discussion of Problems with IRS OVDI/P Program (6/26/13)
The Taxpayer advocate has issue a new report. The portion relate to the IRS’s OVDI/P initiatives is here. I cut and paste some of the discussion (footnotes and tables omitted):
A Government Accountability Office (GAO) analysis shows that the offshore penalty paid by those with the smallest accounts (i.e., those in the 10th percentile with accounts of $78,315) was disproportionate – at least 575 percent of the tax, interest, and penalties on their unreported income. It was also disproportionately greater than the amount paid by those with the largest accounts (i.e., those in the 90th percentile with accounts of more than $4 million) who paid 86 percent or less. Moreover, the IRS initially processed applications from benign actors who are expected to opt out much more slowly than others, though it has recently begun to process them more quickly, as shown by the following table
With our luck, the apology payments will be in the order of $10,000 payable to one account which would then trigger US taxation requirements.
The very fact that an “apology” payment” has to even be considered by the TAO says a lot about how this agency is run. This is the most capricious, complex, unfair agency on the planet outside of North Korea. I feel for TAO since they keep making these reports yet significant over haul does not happen. The very fact that the IRS is told to, and does target people who are whistleblowers, who speak out against wrong doing in the government and others says a lot about their “goal” as an organization. Or at least says a lot about how far they are willing to go. Not all agents agree with all of this. The last one I spoke to about FATCA and what is happening to people here DID say to me “this is wrong” when I asked if she thought this should be happening to people who would owe them zero tax.
This is wrong indeed. If even some of the agents are admitting the issues with FATCA and the harm it is doing then something is very, very messed up here. TAO spoke out last year and got no response. They have to know they are throwing expats under the bus and they have to be doing it on purpose. It’s not as if they have not been told over and over. TAO tries at least.
Levin was speaking out about “fairness” today in reference to prog groups being “targeted” Oh the irony! He’s one of the authors of the biggest targeting by the IRS in history.
This from the
NTA report, comes as a surprise to me, but I admittedly had not gone back and read the “Streamlined” FAQs since it first came out… My fault.
Did anyone see an official press release or notice that they had really changed the conditions of the Streamlined program, or were you just supposed to check daily to see if something new had been posted… I had heard hints that IRS officials at conferences had said that if you exceed the $1500 limit go ahead and to go ahead and submit to the streamlined, but I did NOT realize that they had actually changed the rules as shown below.
Note 7 says…
@ Just Me – I was in the system opting out into Streamlined Program and I did not even know where to find all information on it. Apparently, neither do IRS Revenue Agents, nor especially, Collections Agents.
What even makes me angrier is that at the bottom, it is stated that taxpayers who have participated in previous programs can apply under the new terms and conditions. Do you really think people like the victim Patricia Anderson d’Addario are reading these websites? How would she know to reapply? Lawyers don’t do anything for you if you are not paying them. Even my examiner told me the goal was to get me out of the program and never hear from me again. Why would I want to continue reading about IRS programs if I am done? Where is the Outreach from the IRS? A small gesture like a letter to all OVD participants to let them know their circumstances can be reconsidered under the new programs would generate some good will. Otherwise, the policy appears to be a token one with no real meat behind it.
Yes, Not that Lisa, mechanisms in place that actually PROVE to the taxpayer that the IRS has their best interest at heart would go miles further than any compensation after the fact. Nina Olson’s suggestion of throwing money around to compensate IRS victims when the system is still broken to me at the very least seems seems irresponsible, and at the very worst, corrupt. Providing compensation is no replacement for good sound policy especially at a time when the public’s confidence in the ‘service’ to act responsibly with taxpayer’s money is at an all-time low.
“In January 2013, following the National Taxpayer Advocate’s recommendation to expand the Streamlined Nonresident Filing Initiative to both U .S . residents and those owing more than $1,500, IRS officials publicly announced the IRS had eliminated the $1,500 threshold .(7)”
So they only eliminated the threshold? Residents are still out of luck.
I guess if you’re a US resident with a foreign account, you’re automatically a tax evader.
@Chris
More goal post moving from the IRS. How many people wasted their time, energy and resources entering the latest and greatest OVD program, when waiting (therefore becoming ‘willful’ tax evaders) would have eventually allowed them to enter Streamlined? The IRS continues to shoot themselves in the foot in inspiring any confidence in them whatsoever! Their actions say: Don’t do anything folks because a better deal is around the corner, but if you wait, that’s also a no-no! Is there any choice to become anything other than a deer caught in the IRS’s headlights with this kind of news?
@Not that Lisa!
I agree 100%. I obviously have not been keeping up with the streamlined program or the new technical exception notes they have added, and why would you? I keep looking for an announcement on their Latest News they mass email and post. Do you see it there? Of course not. Not significant enough! Easier to just change rules quietly, and then later, have the TAS point out the “relief” provided.
Here is the Accounting today discussion of the latest NTA report..
http://www.accountingtoday.com/news/taxpayer-advocated-says-irs-in-crisis-67260-1.html#read
@Chris…
I would focus on the last statement of the report:
TAS will continue to advocate for the IRS to expand its Streamlined Program to U .S . residents, to clarify and formalize the terms of its OVD programs by requesting public comments and then publishing guidance in the federal register (rather than a website posting), and revise Forms 8938 and/or TD F 90–22 .1 to reduce taxpayer burden and the duplicative reporting .
That is you, as a resident, so I think your message is being heard, at least by Nina
The latest NTA report does not include international issues as an “area of focus” for 2014, but it has follow-ups on the IRS responses to the international issues from last year:
http://www.taxpayeradvocate.irs.gov/userfiles/file/FY15-Full-Report/IRS-2013-MSP-Responses.pdf#page=86
Hilarious quotes:
Oh yeah, the FATCA FFI lookup tool. REAL helpful for an overseas citizen trying to file their taxes. Thanks so much for all that online service delivery.
Translation: “We’ll pay to put Criminal Investigations Division guys in overseas offices, but not to actually prevent overseas citizens from unknowingly committing Form Crime in the first place”.
@Eric, re; “translation: “We’ll pay to put Criminal Investigations Division guys in overseas offices, but not to actually prevent overseas citizens from unknowingly committing Form Crime in the first place”.”
As we know, the US has no shame: ex. the notice on the website of the embassy in Ottawa- for several years now – at least since 2011 if not before, stated that the in person IRS information sessions were cancelled in Canada due to IRS budget cuts – at the same time in which they are intent on pursuing and persecuting the 2nd largest population of US citizens abroad – in Canada – via FATCA, FBARs, etc. As we know, in 2011 they were busy loudly threatening and herding everyone abroad into the OVD programs.
Here is the ridiculously hypocritical statement on the US Embassy Ottawa site:
“Taxpayer Assistance
The information on this page is intended especially for taxpayers residing in Canada. Note: Owing to budget cutbacks, the Internal Revenue Service will not/not be providing any in-person assistance or tax seminars at the U.S. Embassy and certain of the Consulates General in Canada.”
and,
“IRS Ottawa
The Internal Revenue Service (IRS) does not maintain an office in Canada.”
They appear to have taken off the earlier notice that an IRS Attache was (and probably still is) stationed at the Embassy in Ottawa, and the exhortation about a snitch hotline. I know it was there because I noted the irony at the time. Hope I remembered to take a screen capture and save it somewhere as proof.
“In person at the IRS: You can apply for an ITIN by bringing your completed forms and documentation to any IRS Taxpayer Assistance Center in the United States or IRS office abroad. Please note there are no IRS offices in Canada.”
The only value of a tax payer abroad is penalty revenue, so no use having some available close by to reduce that opportunity!