Practice management

The Internal Revenue Service is requesting membership nominations for the Information Reporting Program Advisory Committee, a body that provides recommendations to IRS leaders on information reporting and administration issues.

The Internal Revenue Service has selected seven new members for the Advisory Committee on Tax Exempt and Government Entities, a formal body of external stakeholders in the specialized areas of tax-exempt organizations, employee retirement plans, tax-exempt bonds, and federal, state, local and Indian tribal governments.

IRS SOLICITS MEMBERS FOR ADVOCACY PANEL: The Internal Revenue Service is accepting applications for joining its Taxpayer Advocacy Panel.

The Internal Revenue Service's tough stance on settling the "Son of Boss" tax shelters matches the call by the IRS Oversight Board for increased compliance funding, as well as the tax gap findings of the National Research Program. Together, they signal a sea change from the kinder, gentler, post-1998 hearings IRS.

Washington - The Winter 2004-2005 Statistics of Income Bulletin, a quarterly compilation of information on various topics from federal tax returns and other documents, has been released by the Internal Revenue Service.

It's official: Taxpayers who file paper returns are in the minority, the Internal Revenue Service reported.

As of this writing, bankruptcy reform legislation had passed the Senate and was expected to move quickly through the House and be signed by President Bush. The Bankruptcy Abuse and Prevention and Consumer Protection Act of 2005 may already be law as you read this column.

In recognition of National Small Business Week, the Internal Revenue Service has made available a number of free online resources to help the nation's 45 million small business and self-employed taxpayers with their tax responsibilities.

SurePrep, known for its outsourcing services, has developed a tax preparation workflow system to help firms maintain greater control over tax preparation decisions while reducing review and correction time. SurePrep Express is a Web-based system that categorizes scanned source documents to ease processing and data entry.

The implementing states of the Streamlined Sales and Use Tax Agreement voted to create an associate membership, keeping the agreement on track toward its Oct. 1, 2005, interstate effective date.

The Internal Revenue Service is seeking applications to fill seven vacancies on the Electronic Tax Administration Advisory Committee, a 14-member panel that provides a public forum for discussion of electronic tax administration issues in support of the goal of paperlessly filing tax and information returns.

The president and vice president saved a combined $110,182 in taxes last year under the income tax cuts passed by their administration, according to an analysis of the 2004 tax returns released by the White House.

Tax preparation and related fees from H&R Block Inc.'s U.S. retail operations increased 6.4 percent to $1.9 billion through March 31, 2005, the tax prep giant reported.

Washington - The call for the nation's tax preparers to be more closely monitored for proficiency has been echoed by the National Taxpayer Advocate, as well as by a number of tax professional membership associations.

Within the new reality of date-sensitive tax legislation, practitioners must not only be attentive to sunset provisions for the many tax benefits now granted by Congress - they also need to keep a calendar marked for benefits that phase in or start on a time-delayed basis. In the latter category, one of the more extreme examples is about to hit potentially millions of businesses and tax-exempt employers.

Apparently, there's a good reason the regular 1040 is referred to as the "long" form -- it takes the average taxpayer more than a full day to prepare the form with three common schedules, according to an annual study of tax complexity.

The Internal Revenue Service needs to remedy serious weaknesses over taxpayer and Bank Secrecy Act data that leave its systems vulnerable, according to a report released by the Government Accountability Office.

With the April 15 tax filing deadline looming, the Internal Revenue Service says that e-filing, direct deposit and e-payment programs continue to move at record paces so far this year.

The Internal Revenue Service announced that as of April 1, some 52 million returns had been filed electronically, 7 percent above last year's e-filing pace. Overall, 65 percent of all returns were e-filed -- up from 60 percent for the same period last year. The service also reported that roughly 4 million returns have been filed via the Free File program -- up 44 percent from the year-ago figures. "As we get deeper into the tax filing season, the percent difference between how many people are using e-file and how many used it last year keeps going up," said IRS Commissioner Mark W. Everson. "This shapes up as a really strong year. Taxpayers who haven't filed yet should check into e-file and Free File." The IRS also said that 42 million refunds have been paid through direct deposit, up 5.7 percent for the same time last year.

Senators from both sides of the aisle and the Treasury Inspector General for Tax Administration questioned the plan by the Internal Revenue Service to cut back its walk-in and telephone Taxpayer Assistance Centers during a hearing on the 2006 IRS budget. IRS Commissioner Mark Everson discussed the agency's plan to close as many as 105 TACs and cut back its toll-free telephone service by 15 hours a week at the Senate Appropriations Subcommittee hearing. TACs are located nationwide and allow taxpayers to have face-to-face meetings with IRS employees who can assist taxpayers with tax law, tax return preparation and account inquiry resolution. "The IRS needs to balance customer service with its compliance and enforcement efforts," said Sen. Christopher Bond, R-Mo., chairman of the Transportation, Treasury and Housing and Urban Development Subcommittee. "I believe that most people who fail to comply with the tax code do so unintentionally because of its difficulty and complexity. Accurate and timely guidance from the service is imperative to ensuring taxpayer compliance." Colleen M. Kelley, president of the National Treasury Employees Union, warned that closing Taxpayer Assistance Centers will result in reduced taxpayer education and compliance at a time when the gap between taxes owed and amounts paid has increased to upwards of $298 billion.