The national taxpayer advocate gives annual address to National Tax Conference

By Paul Bonner

Editor: Sally P. Schreiber, J.D.

On Nov. 13, the AICPA National Tax Conference in Washington also heard from National Taxpayer Advocate Nina Olson about particular taxpayer quandaries and needs. She discussed the breadth of types of taxpayers needing help from the Taxpayer Advocate Service (TAS) — ranging from large multinational corporations trying to comply with the transition tax under the TCJA's new Sec. 965 on the one hand, to, on the other, Amish people, who refuse to obtain Social Security numbers on religious grounds. Olson also discussed verification problems of taxpayers applying for individual taxpayer identification numbers (ITINs).

She also described problems with the IRS's Pre-Refund Wage Verification Program last tax filing season that matched — or in sizable numbers falsely detected a mismatch between — returns and Forms W-2, Wage and Tax Statement. The mismatches led to a 230% increase in pleas to TAS for help obtaining refunds by taxpayers whose returns were flagged as "questionable," with the result that refunds were delayed until as late as July last year.

One partial solution she has advocated is to process those returns daily rather than weekly for matching to updated employer copies of the W-2s, she said.

The snafu illustrates her misgivings about the IRS's stated goal of a "future state" that will increasingly rely on automated processes and online interaction with taxpayers. The present state of the IRS's antiquated core data processing systems she likened to a Rube Goldberg contraption, referring to a series of comical illustrations of extravagantly makeshift devices to perform simple chores popular in the early 20th century.

"That really creates risk in the system," Olson said.

Newsletter Articles

TECHNOLOGY

2018 tax software survey

Among CPA tax preparers, tax return preparation software generates often extensive and ardent discussion. To get through the rigors of tax season, they depend on their tax preparation software. Here’s how they rate the leading professional products.

DEDUCTIONS

Qualified business income deduction regs. and other guidance issued

The package includes final regulations, guidance on how to calculate W-2 wages, a safe-harbor rule for rental real estate businesses, and new proposed rules on the treatment of previously suspended losses.