Friday, May 6, 2011

Notes from the IRS Liaison Meeting

Dave Flemmer himself and I were participants in an IRS liaison meeting this morning. What was supposed to go from 9 until 11:30 ended up spilling over to about 12:30. Yes, it was long. Yes, it was arduous. And yes, it was informative.

I’m going to highlight some of the things I learned at the meeting. First of all, IRS employees have an uncanny ability to internalize the objectives of their respective departments to a degree that is a little unsettling. Now don’t get me wrong, everyone in the meeting was as nice as could be, it’s just that they seem to lack an ability to think outside of their immediate job duties, which is strange considering I’m sure nobody grew up thinking they want to be a collections agent for the IRS so they can help get the IRS the money they’re owed. They said a number of times that we as tax practitioners were the first line of defense in their crusade to eliminate tax fraud and to get those that owe to pay up. I guess working for the IRS, you are desperate for professional allies and the hope is that we’ll want to be a part of their mission since we are after all brothers in the tax business.

This over identification with their departments was in evidence when they went around the room and had each of them explain a ‘little’ about the work they do. The acronyms were flying and there was more than a little shop talk that we as outsiders were not at all familiar with.

But within the jargon was a lot of useful information.

Unenrolled Agents – Unenrolled agents, or uncertified tax preparers, will have to be fingerprinted before they will receive their PTIN’s. They will also have to maintain 16 hours of CPE a year

EFTPS – Every business has to make payments of more than $2,500 using the EFTPS system, the IRS online payment program. The IRS will no longer accept paper coupons or checks. There are ways around using the system but they make little sense.

Taxpayer vs. Tax Preparer Accuracy Statistics – We learned in the meeting that 5% of taxpayer prepared returns had errors while tax preparer returns had an error rate of 1%. But that was on paper returns. For electronic returns the numbers for each were both under 1%. Now, these are math errors and not reflective of whether the returns reflected over or under estimates of income or deductions and credits.

Examinations – Essentially what was stressed was that you and your clients should show up to the examination meeting prepared and having brought exactly what was requested. It will put you on a better standing with the IRS and will help allay the agents’ suspicion. Basically, stay on their good side and they’ll be more understanding.

Issue Management Resolution System – This is a program that has been put together to help address issues within the IRS, both discovered internally and from without the organization, that is going to make it easier to correct problems. It’s essentially bureau wide clearinghouse so that problems can be handled once instead of each time they show up individually.

Well, this is the gist of what I got from the meeting. My hand became very tired and I wasn’t able to get everything. Nor was my mind capable of taking in everything that was said, but I hope that this info is of some use to you.

1 comment:

  1. There are ways around using the system but they make little sense.