The National Taxpayer Advocate recently released her mid-year report to Congress, discussing just how the Revenooers are doing this year. Some good; some bad.
On the positive side, the Advocate observed what a good thing it was that IRS has adopted a Taxpayer Bill of Rights (TBOR).
The Advocate had long recommended that this be done. Particularly in light of the fact that a survey which the Advocate conducted in 2012 found that less than half of U.S. taxpayers thought they have any rights, whatsoever, before the IRS. Not surprising.
Further, only 11 percent said they know what those rights are!
The TBOR, wrote Advocate Nina Olson “has the potential to be an important milestone in tax administration.”
“Potential” is nice. Actuality and realization is the true measure in our view.
On the not-so-good side, though, Advocate Olson notes that hundreds of thousands of taxpayers have become victims of tax-related identity theft, and many folks have been victimized by unscrupulous tax preparers who have stolen tax refunds by fraudulently altering information on folks’ returns. And to add insult to injury, IRS has generally declined to issue refunds to victims of tax preparer fraud.
“The IRS has consistently dragged its heels, making one excuse after another, because providing relief to these victims just is not a high enough priority, or more disturbingly, because the IRS simply does not want to provide relief,” says Olson.
Why not, we ask?
Another area in which the Revenooers have been found lacking is the mess we and thee see mentioned on TV just about every day in the last several months: the matter of how IRS scrutinizes organizations seeking tax exempt status.
Advocate Olson has a proposal that could provide a clearer test to determine whether an organization seeking exempt status under Code Section 501(c)(4) is planning to operate “primarily” for social welfare purposes. This has become such a hot button issue that the Advocate expects to include a legislative recommendation (to remedy the presently murky rules) in her year-end report to Congress.
Regardless of the efficacy of the Advocate’s efforts, it’s nice to know that somebody is looking over IRS’ shoulder. Hopefully her hard drive won’t crash in the near term.
CONSULT YOUR TAX ADVISER – This article contains general information about various tax matters. You should consult your CPA regarding the implications to your own particular situation. Jeff Quinn is a shareholder in Ashley Quinn, CPAs and Consultants, Ltd., with offices in Incline Village and Reno. He may be reached at 831-7288, welcomes comments at firstname.lastname@example.org, and invites readers to consider his other commentary at http://blog.nolo.com/taxes.